- Charts suggest that the selling in the world’s two largest cryptocurrencies may run its course soon, CNBC’s Jim Cramer said Monday.
- “To me, that says it might be too late to sell and you need to consider buying. I know I am, especially if we get a final leg down,” Cramer said.
- The “Mad Money” host rooted his comments in analysis from veteran technician Tom DeMark.
Charts suggest the selling in the world’s two largest cryptocurrencies may run its course soon, CNBC’s Jim Cramer said Monday, leaning on analysis from veteran technician Tom DeMark.
“When the charts, as interpreted by Tom DeMark, say that both bitcoin and ethereum could be looking at downside trend exhaustion bottoms this week, if not today, I think you need to take him seriously,” the “Mad Money” host said.
“To me, that says it might be too late to sell and you need to consider buying. I know I am, especially if we get a final leg down,” added Cramer, who personally owns some ether, which runs on the ethereum blockchain. He previously owned bitcoin, as well.
Bitcoin earlier Monday reached its lowest point since July when it fell to $32,982.11 per token, according to Coin Metrics. However, bitcoin reversed course during the trading day, ultimately moving higher to around $36,000. The cryptocurrency remains well off its all-time high of nearly $69,000 reached in the fall.
Ether also touched its lowest level since July on Monday, falling as low as $2,176.41 before paring some of those losses, according to Coin Metrics. It’s down about 50% from its all-time high.
Bitcoin
While there’s a risk that bitcoin’s steep decline in recent weeks could cause structural damage to the cryptocurrency, Cramer said DeMark is betting that will not happen — just like bitcoin’s roughly 56% drawdown from April to June 2021 didn’t prevent it from setting new highs in the fall.
In fact, DeMark notes that bitcoin’s current angle of descent is identical to its 2021 plunge, Cramer said. “In other words, there’s a good chance that history continues to repeat itself.”
Looking specifically at bitcoin’s recent trading, Cramer said the cryptocurrency is at No. 11 of DeMark’s well-known 13-session countdown pattern, which the technician uses to identify when a rally or decline will be exhausted.
“We need two more negative closes before his buy trigger fires,” said Cramer, who added that DeMark also would like to see bitcoin test his downside price targets.
If Monday’s intraday turnaround ends up leading to only a brief rally, “DeMark wouldn’t be surprised to see bitcoin getting hit with a two- or three-day panic selling climax, which could briefly take it all the way down to 26,355,” Cramer said.
Ether
Ether “has already hit 13 on his buy countdown for the first time since the peak. That tells DeMark that we could be looking at a trend exhaustion bottom,” Cramer said, noting that “fortunately” ether also fell beneath DeMark’s downside price projection of $2,434.
Despite these positive technical indications, DeMark cautions that ether may still fall further. “If we get another panicked breakdown, he could see [ether] temporarily dipping to $1,859 in a selling climax, but that would be your moment to buy, not sell, into the teeth of the panic,” Cramer said.
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Source: Business - cnbc.com
