The host of CNBC's Crypto Trader show, Ran NeuNer, has a chat with the experienced commodities broker, Peter Brandt, who became best known as being one of the first who accurately predicted the end of the bull run in December 2017.
The 71-year-old veteran trader, Peter Brandt, predicted that the December 2017 speculation bubble around Bitcoins price was too large and would soon burst, causing the asset to lose more than 80% of its value.
When the bull run was at its all-time-high Peter Brandt tweeted this to his almost 250K twitter followers:
'General TA rule — a violation of parabolic advance leads to 80%+ decline in value. If general rule is followed, BTC should retrace to <$4,000. Note: This Tweet does not make me a hater'
'I’ve seen that sort of thing take place so many times in the past and they always end the same, prices always fall 80% to 90%', he said.
Brandt turned out to be spot on with his predictions, both at the end of January and ever since.
Not only did he call the bear market for Bitcoin, he was as well correct in calling Ethereum to $120, while everyone else thought this was impossible.
NeuNer asks Peter Brandt how he feels about the TA crypto charts that appear all over social media.
Well, he says, it is mainly fairydust, it is not real technical analysis, it is 'make-believe'.
'What I see are a bunch of charts that are posted that in no way reflect the old, tried and true principles of TA. People are reinventing TA, just to fit their own personalities and their own bets and pre-assumptions'
'They frankly look like maps to an outer galaxy. They look like Star Wars maps'
Brandt says that technical analysis historically deals with what the market is telling us right now, relative to what happens next. These charts on social media are not based on anything Brandt would consider to be classical charting principles.
'I look at these charts and ask myself, where do these people get this stuff? It is based on people's hopes and dreams and that's about it'
NeuNer goes on to ask Brandt how come he had such a series of correct predictions on crypto Twitter last year, and what he is doing that others aren't.
Brandt replies by saying that he thinks he is standing in the 'here and now'.
'You don't do technical analysis based on presuppositions. You do it based on what the market is offering you as facts.'
'Where is the bloodtrail leading you? You follow the bloodtrail in the snow.'
Brandt claims he tries to stay in the present and stay grounded in what the market is telling him now.
Read more: Will Bitcoin replace fiat money?
He further explains that predicting the end of the bull run in December 2017 was an easy one.
'I look at Bitcoin, and Bitcoin has been through a series of historical phases. The last one being of course the parabolic advance that we had in 2016-2017.'
Brandt says that it is rare for a market to have a parabolic advance.
'So when that parabolic advance was broken, it was an easy call to say Bitcoin is going down 80%.'
Take a look at the interview below.
In December 2018 Brandt predicted that there will be another massive drop. This new low will be a major test both for the industry.
Mr. Brandt expects this drop to stabilize at around the 1200 price range, undoubtedly testing the resolve of even the most committed of crypto fans.
'Crypto won’t have any friends at that point. Even the crypto die-hards might start to think they are done with it', he said.
Read more: Will Bitcoin recover in 2019?