Chief Investment Officer Calls For Violent Stock Market Reckoning, How Will Bitcoin Respond?

Tony "The Bull" Severino

1 year ago

3 mins read

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The economy is on thin ice and jobless claims are still outrageously high, yet the stock market continues its V-shaped recovery and powerful rally. However, one chief investment officer claims that a stock market day of reckoning is coming – one that could also cause another sharp collapse in Bitcoin.

If the stock market does indeed crash due to fundamental weakness, will Bitcoin price follow and retest Black Thursday lows?

Day of Reckoning To End Irrational Exuberance in the Stock Market

At the start of the year, the stock market set new records for the highest prices ever recorded. Around the same time, Bitcoin had recovered to over $10,000 and looked to be beginning a new uptrend ahead of the asset’s halving.

But a black swan event arrived with the emergence of a widespread pandemic that continues to have a crippling effect on the economy even today.

Lockdown conditions remain intact, and protests and violence have erupted all over the world due to individuals fed up with the status quo. The conditions aren’t at all ideal for a major stock market rally, yet stock indices like the Nasdaq, Dow Jones, and S&P 500 have made unexpected recoveries.

Individual airline stocks and rental car chains that have recently filed for bankruptcy, have exploded with sudden growth. The market is behaving completely irrationally, leaving one expert to say that investors are in “la-la land,” and expects a day of “reckoning” in the stock market soon.

“The mania is based on a widespread hope in Fed money printing. The catalysts for reckoning are numerous as a major cyclical economic downturn has only just begun,” said Kevin Smith, Crescat Capital’s chief investment officer.

This day of reckoning, can bring the irrational exuberance across the stock market to a screeching halt and may take Bitcoin down again with it once again.

Bitcoin Could Dump 20% Or More If The S&P 500 Collapses

Due to the correlation in Bitcoin and the stock market, any day of reckoning in the stock market puts the cryptocurrency space at risk for another collapse.

Trigger-happy crypto investors may be ready to dump the high-risk assets at the first sign of rejection in Bitcoin price. The asset has been trading sideways for over 50 days now, and a major move is expected when the record-low volatility finally breaks.

Bollinger Band Width is showing some of the lowest volatility in the typically volatile asset, and a variety of unusual factors such as today’s Quadruple Witching in the stock market, Mercury in Retrograde, and more could cause a shakeup in the already fragile financial space.

A day of reckoning in stocks could be disastrous for Bitcoin. Data shows that after this much consolidation, a 20% move usually follows any breakout. A crash in stocks could pull Bitcoin down with it once again – just like it did on Black Thursday in March.

It also could trigger the 20% move that most traders are preparing themselves for.

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.

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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.

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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.

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