Gareth Soloway, Verified Investing's chief market strategist, warned Friday that Bitcoin could plummet 38% to $50,000 as the price forms a bear flag pattern near $85,000. He also flagged the S&P 500 for showing market signals similar to those at the dot-com boom peak.
Bitcoin's Technical Warning
The strategist described a bear flag pattern developing around the $85,000 level. This technical formation often precedes a sharp downward move. Soloway projected the drop to $50,000 could happen if the pattern plays out. He didn't specify a timeline for the potential decline. The warning comes as Bitcoin hovers near recent highs. Traders are now scrutinizing the $85,000 mark for any breakdown signal. This isn't the first time technical patterns have triggered his caution this year.
S&P 500 Signals Raise Concerns
Soloway explicitly compared current S&P 500 market signals to those observed at the dot-com boom peak. He didn't detail which specific indicators mirrored that period. The parallel suggests potential equity market risks ahead. It's a stark historical reference the strategist doesn't make lightly. The comparison landed Friday as stocks showed mixed performance. Market watchers noted the timing with recent volatility.
What's Missing in the Warning
No specific catalysts were cited for either potential move. Soloway didn't name what might trigger Bitcoin's drop or the S&P correction. The lack of catalyst details leaves investors guessing. The firm also didn't specify how long the patterns might take to play out. Traders are now watching Monday's open for any early signs. A break below $85,000 could signal the decline's beginning.
