Crypto Sphere Believes Galaxy S10, JPM Coin Behind Bitcoin Rally, But Is Really a Return to Mean

Tony "The Bull" Severino

Last Updated: March 11, 2019 8:34 pm

3 mins read

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The crypto market lit up with green over the last 48 hours following a powerful rally led by Litecoin, Ethereum, and EOS, which also helped propel Bitcoin toward important psychological resistance at $4K. Should the first-ever cryptocurrency break through the resistance, a major blow will be dealt to bears and could signal that a bottom is already in.

Battered and beaten bulls are tirelessly trying to find correlations to news that may be driving the rally, however, the move is likely a return to mean following extremely oversold conditions.

Crypto Community Searches For News Correlations Behind Bitcoin Rally

Reading through various crypto community discussion groups, members are filtering through recent crypto news hoping to discover the reason behind Bitcoin’s sudden boom. Over at Reddit in both r/bitcoinmarkets and r/cryptocurrency the common speculation on what’s fueling the recent rally points to today’s reveal of the Samsung Galaxy S10.

Announcements from the tech world rarely cause any movement in crypto markets, however, Samsung’s rumored inclusion of a crypto wallet has enormous implications, potentially exposing crypto to millions and millions of the South Korean tech giant’s customer base.

Elsewhere, even Bloomberg is suggesting the recent rally is being driven by news. In a tweet, the media powerhouse claims Bitcoin is having a “delayed boost” thanks to the announcement of JPM Coin, the new “cryptocurrency” announced this week by banking beast JP Morgan this past week.

Bitcoin is getting a delayed boost from the announcement that JPMorgan has developed a digital coin to speed up payments between corporate customers 📈 https://t.co/L9eQ5YBxZ2 pic.twitter.com/mAvqXj8ZQe

— Bloomberg Crypto (@crypto) February 19, 2019

However, in recent weeks, the market has barely responded to news – good or bad. For example, the ongoing QuadrigaCX imbroglio that resulted in millions in crypto being lost due to the exchange founder’s passing, would have caused a massive sell-off had it occurred in mid-2018.

Bitcoin and Crypto Markets Return to Mean After Oversold Conditions

The reality in current crypto markets is that Bitcoin and its altcoins brethren are posting gains following sustained downward movements and extremely oversold conditions. Such oversold conditions on assets can cause markets to mean revert, according to prominent trader and Bitcoin.live panel member Peter Brandt.

Regarding RSI, Stochastic, MACD et al. Markets can remain overbought far longer than many bears have the ability to pay up for a losing short position. OB/OS measures good for trading range mkts. Severely OS mkts tend to mean revert.

— Peter Brandt (@PeterLBrandt) February 19, 2019

When any asset reaches extremely oversold or even overbought conditions, the market tends to correct and returns toward its mean. The scenario played out perfectly when Bitcoin’s parabolic advance was broken in late December 2017, and the inverse occurred after Bitcoin fell through support at $6K.

The powerful downward movement took Bitcoin and other crypto far below their mean, and the market is now correcting upward toward its mean value.

A commonly shared chart on bubble cycles put together by Dr. Jean-Paul Rodrigue of the Department of Global Studies and Geography at Hofstra University, demonstrates what is happening now during the “blow off phase.” The chart shows that an asset can crash so low, it’s below its mean value and eventually returns as faith is restored in the market.

Feature image from ShutterStock

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.

Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.