Alessio Rastani: We Shouldn’t Buy Stocks or BTC Right Now
Market analyst Alessio Rastani is bullish about both the U.S. stock market and bitcoin.
Alessio Rastani: You Probably Shouldn’t Buy for a Bit
When it comes to stocks, however, he’s a little more unsure and believes that the currency is entering a “risky zone.” He doesn’t believe that the monster-sized crash that arrived in March was a correction, as so many other analysts have claimed. In his eyes, the crash came on too quickly and was too large to amount to a simple correction of sorts. He still believes we are in a long-term uptrend, though he’s confident that the stock market is close to a 100 percent recovery from where it was three months ago.
For this reason, he’s worried that stocks are in danger of being overbought, which could potentially lead to further drops in the coming future. Rastani states:
This rally is going to get overbought and over-extended soon, and the ‘dumb money’ is likely to enter at the worst possible time, very likely when the S&P gets to the 3,150 – 3,200 zone. At the time of writing, the stock market has already reached my first targets at 3,150 and 3,200 (the levels I mentioned in my video two weeks ago on May 22). I think the markets will likely pause here near 3,200 for a pullback, while the potential still exists for this rally to ‘fill the gap’ at 3,300 in the next few weeks or months.
He believes that the stock market would make an eventual recovery following this period, though he’s warning retailers to avoid making any stock purchases in the coming weeks, saying that they will likely deal with heavy financial strain and losses as a result. He comments:
Unfortunately, most people have been on the wrong side of this market. They were bullish at the worst time (in January through February 2020), bearish at the worst time (from the end of March to May 2020), and now greedy at the worst time (June 2020).
In addition to stocks dropping, he says that the shaky financial spectrum could also play a role in bringing bitcoin down somewhat. He stated:
If the positive correlation between bitcoin and the S&P continues, which is likely, then bitcoin could also see a retracement of correction at the same time when the S&P starts its corrective drop, but this correlation remains to be confirmed by price action.
Long-Term Bullish Sentiment
In the long run, however, he’s still very bullish on bitcoin, and believes that the currency will show great promise once this shaky period is over and done with. He states:
I have been bullish on bitcoin since late March and early April 2020, especially when I saw bitcoin holding the weekly 200 moving average (200 WMA). This was an important bullish clue. So long as bitcoin remains above $7,000, I will continue to remain bullish for the long term.