There’s a joke going around on Reddit’s r/bitcoin that CNBC’s Bitcoin price predictions are actually the exact opposite of what will happen. This is called the CNBC Reverse Indicator, which actually proved extremely accurate this past week.
Bitcoin rallied from USD 5,800 in the middle of August 2018 to as high as USD 7,500 in early September, and CNBC issued a forecast on 28 August that USD 8,000 was probably next. The market went in the complete opposite direction a few days later, crashing to USD 6,300, which was CNBC’s stop-loss level.
Bitcoin breaking back above $7K today and @Bob_Iaccino says $8K could be next pic.twitter.com/lZQu1V2dzd
— CNBC Futures Outlook (@FuturesOutlook) August 28, 2018
Jokes were abundant on Reddit following this verification of the CNBC Reverse Indicator. CashCoinsCrypto says, “the prophecy was fulfilled”. Chieres wrote, “So all I need to do is to follow CNBC and always do the opposite?” In response, badinsie says, “Yup, you’ll win 95% of the time”. Utoko added, “About 3 weeks ago they had a guy on there who said [Bitcoin] will go close to zero”; in response Fuadiansyah says, “So we need that guy to present every day at CNBC”.
Is there anything real to the CNBC Reverse Indicator? Redditors will be keen to point out that CNBC simply doesn’t have true crypto expertise and is wrong most of the time since they are used to typical asset classes, which differ distinctly from crypto. Others speculate jokingly that the program is deliberately issuing forecasts that are the opposite of reality to manipulate the markets in their favor.
In reality, no study has been done to see if the CNBC Reverse Indicator is accurate, which would be necessary before anyone starts making trading decisions that are the opposite of everything CNBC says.
Assuming the CNBC Reverse Indicator is legitimate, what should Bitcoin traders do next? CNBC’s latest prediction is for Bitcoin to rise to USD 7,250, with USD 6,450 being a good buying level. Therefore, if the CNBC Reverse Indicator is accurate it’s time to sell since Bitcoin will be crashing some more.
#Bitcoin getting crushed again. Here's how @BrianStutland is trading the #crypto pic.twitter.com/BgTCXsAOLZ
— CNBC Futures Outlook (@FuturesOutlook) September 6, 2018
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