Bitcoin's 100% Gains in Waves 1 and 5 Signal Market Peak, Says Severino

Technical expert Tony Severino has recently expressed his shift in sentiment regarding Bitcoin (BTC) and other cryptocurrencies, citing several reasons for his newfound bearish outlook amidst the recent price drawdown. Severino, who had previously suggested that Bitcoin could drop to as low as $22,000, has now provided a detailed analysis based on market cycles and the Elliott Wave Theory.

Severino's analysis, shared on a social media platform, highlights that the Bitcoin price has recorded a 100% gain in both Wave 1 and Wave 5 of the current bull run, which began around November 2022. According to the Elliott Wave Theory, this similarity in price gains suggests that the top of the market cycle has been reached. However, Severino acknowledges the possibility of further price increases, noting that Bitcoin could replicate the gains seen in Wave 3 following the launch of Bitcoin ETFs last year.

Severino also points to the euphoria surrounding Donald Trump’s inauguration as an indicator that the market cycle may have peaked. He explains that the euphoria phase typically precedes the cycle top, and although the euphoria around Trump’s inauguration was not as pronounced as expected, the pattern of cyclical crests supports his bearish stance. Severino observes that Wave 1 and Wave 3 topped at the cyclical crest, suggesting that Wave 5 is likely to follow the same pattern.

In addition to the Elliott Wave Theory, Severino references other chart patterns and indicators that suggest Bitcoin has reached its peak. He notes a curve trendline indicating that Bitcoin has reached the point of maximum financial opportunity in this market cycle. The Parabolic SAR (Stop and Reverse) indicator suggests that Bitcoin's parabolic phase has ended, and a reversal may be imminent. The Average Directional Index (ADX) shows that the strength of Bitcoin's uptrend is weakening, further supporting Severino's bearish outlook.

Severino also highlights the Logarithmic MACD as an indicator of declining momentum for Bitcoin in this market cycle. He concludes that the upward momentum for Bitcoin is weakening and is unlikely to recover soon. This comprehensive analysis provides a clear rationale for Severino's shift from a bullish to a bearish stance on Bitcoin and other cryptocurrencies, reflecting his technical expertise and thorough market analysis.