Cryptocurrency traders are forever looking for reliable indicators to help them time their market entries and exits. Seemingly trivial, yet with surprising accuracy, the hosts of CNBCâs âFast Moneyâ have served as such a signal in the past.
The theory, documented in 2018 by trader and Forbes contributor Jacob Canfield, is that a bullish CNBCÂ corresponds with an imminent drop in Bitcoin price. Similarly, the opposite held true during the period Canfield studied.
In a post made to the charting website TradingView, Canfield presented a chart of Bitcoinâs price performance from late 2017 to mid-2018. [TradingView] The trader overlaid instances in which CNBC expressed clearly bullish or overly bearish sentiment.
With a startling 95 percent accuracy over the period in question, a bearish CNBC lined up with bullish price action, and a bullish CNBC coincided with a drop in prices. Canfield wrote:
SponsoredâAlmost every single bullish tweet weâve seen has been at the top of nearly every single rally, giving us a very strong sell signal. With every bearish tweet we see, it has been a clear indicator of a short reversal and end of a rally.â
In the most recent edition of CNBCâs âFast Moneyâ, sentiment from the panel was more than a little optimistic. In less than two minutes, the five panelists hit upon just about every popular bullish argument for Bitcoin from the last year or two.
The traders and presenters highlighted issues reported frequently by BeInCrypto. Amongst other topics, they mentioned: Bitcoin as a safe haven asset, growing institutional interest in the industry, central bank-issued digital currencies, and the leading cryptocurrencyâs similarities to gold.
Podcaster and Morgan Creek Digital Assets co-founder Anthony Pompliano highlighted just how bullish the panelists seem to have become on Bitcoin:
âIn a world of fiat currencies, Bitcoin is the victor.â
"In a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In a world of fiat currencies, Bitcoin is the victor."
đ„đ„đ„đ„ pic.twitter.com/UG72brI3LC
â Anthony Pompliano đȘ (@APompliano) February 12, 2020
Although not a major dip, Bitcoin has indeed traded downwards since the segment aired. Still trading for more than $10,100 at the time of writing, the cryptocurrency dropped from a local high of more than $10,420 earlier Thursday.
For now, the price drop is considerably smaller than many of those Canfield documented during 2018. However, trading using the unconventional indicator would still have yielded a profit.
