Could The Golden Ratio Provide Clues To The Bitcoin Bottom?

Tony "The Bull" Severino

Last Updated: June 11, 2024 8:35 am

3 mins read

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Bitcoin and other assets often develop support and resistance around Fibonacci levels, either through extensions or retracement. The ratios are based on the Fibonacci sequence, which has ties to the Golden Ratio.

With the top cryptocurrency so tied to mathematics, the Golden Ratio could provide clues as to where Bitcoin is in its latest market cycle, and if a bottom has been put in.

Cryptocurrency And Mathematics: More Than Just Code And Geometrical Shapes

The Bitcoin code is built entirely on math, its distribution protocol also steeped in math, and just about everything else about it. The scarce supply of 21 million BTC is slashed in half every four years, and the sum of the event is often an imbalance of supply versus demand in favor of price appreciation.

Even chart patterns and technical indicators are little more than math – geometrical shapes drawn manually and statistics represented through graphical overlays and oscillators.

Related Reading | Fibonacci Day: How To Use Math To Trade Crypto

But could math also be used to find Bitcoin tops and bottoms? Among the most accurate tools for picking out the top of each market cycle is called the Pi Cycle indicator and is based on the mathematical constant. And according to one trader, the Golden Ratio is how to find each Bitcoin bottom on the way up during the bull market.

The crypto asset has historically retraced to the 1.618 Fibonacci ratio | Source: BTCUSD on TradingView.com

How The Golden Ratio Could Act As The Bitcoin Bottom Before New Highs

According to the pseudonymous analyst, after fully recovering to the 1.0 Fibonacci ratio and breaking above it, Bitcoin then blasts through the 1.618 Golden Ratio, only to later retest it. Retesting it has resulted in the last major correction before the final bullish impulse that takes the cryptocurrency to its genuine cycle top.

Other tools related to math have called the cycle top, as mentioned above. However, the tool’s creator says the crossover to give the signal was so narrowly achieved, it leaves room for another cycle top a few months later.

Bitcoin price is trying to hold closer to $40,000 after a deep plunge to $30,000 and one of the worst monthly selloffs on record. But that selloff went right to the Golden Ratio as the cryptocurrency has during last market cycles and each time that was it for the downside.

Not only did the nascent digital asset reclaim highs, it more grew another 500% from the lows. As we now know math rarely is wrong when it comes to the cryptocurrency, and another similar percentage climb would take Bitcoin price well over $100,000 per coin.

Featured image from iStock Photos, Charts from TradingView.com

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.

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