CNBC’s Jim Cramer is encouraging that financiers who are looking for entry and exit points keep a close eye on both stock and cryptocurrency sell the coming weeks.
The “Mad Money” host on Friday examined chart analysis from Tom DeMark, the creator and head of DeMark Analytics.
“The charts, as interpreted by Tom DeMark, suggest that bitcoin might take another month to bottom, while the S&P 500 could peak as soon as next week,” he stated. “Considering Tom’s track record, that’s a good reason to be patient with bitcoin and approach the S&P with some caution.”
DeMark created the DeMark Indicator, which some traders utilize to time the marketplace. The method, which follows patterns to predict when a pattern might alter course, is popular amongst crypto traders to find low and high, Cramer stated.
Cramer examined the everyday chart action for bitcoin, which peaked at around $65,000 in mid-April. The digital coin is now trading above $37,300 since Friday after being up to $30,000 in mid-May.
DeMark, who stated the drop in bitcoin looks like the crash of 1987, predicted that the decrease might bring the token’s worth to a flooring of $32,000 — or $24,000 in the worst case. He now believes that bitcoin will typically hold above the May 19th low, Cramer stated.
In what’s referred to as “Black Monday,” the Dow Jones Industrial Average plunged more than 20% on Oct. 19, 1987. It was the bookend of a 36% decrease in the blue-chip index from August that year.
“If DeMark’s right, you could get a chance to buy bitcoin in the not-too-distant future, and I might take it,” Cramer stated. “I think this ’87 analogy is good news. After the crash of ’87, the stock market bounced back fast.”
As for the S&P 500, which closed at a record for the second-straight day, DeMark’s sign recommends the index might be near to a top, Cramer stated. DeMark has rate targets of $4,335 and $4,344, about 2% greater than Friday’s surface.