Since the days it was worth cents, bitcoin goes through a very distinctive pattern. It increases ten fold and then plummets to a fraction of it's value. Now, let me tell you why it will happen again soon.
"The past should serve as a lesson to the future, in order we do not repeat the same mistakes"
Early days of Bitcoin (2010-2012)
We go back to the year after Satoshi proposed the Bitcoin protocol, and it's earliest adoption. Bitcoin wasn't worth much, but over a course of two years, it rose steadily - cent by cent, to the value of a few dollars. The accumulation period was over, and hype set in. It took bitcoin to stellar heights within a single month, reaching 30$, but corrected rapidly and surely, setting the stage for a year long bear market. New support level was found at 7$.
Please notice the ten fold increase in the price, followed by a crash
The crash of 2013
As we continue our journey, we find ourselves at the start of 2013. The support levels were reached at previous highs, and a new accumulation period began. Again the price exploded, soaring to the 200$ mark, increasing the value ten fold, only to crash and form a new support at the 100$ mark.
Mt. Gox crash (2013-2014)
The crash of Mt. Gox, which at time represented 75% of the daily trade volume, saw Bitcoin loose 80% of its value. The bear market that followed lasted for two years. I would like you to pay attention to the red square representing the previous ten fold increase and the subsequent drop. The price tipped 1000$ shortly, rallying new support at the 200$ mark.
Bitcoin price 2010-2017
This chart represents bitcoin from its earliest days, to the present moment. I have shown three major events with the previous images, events that saw bitcoin skyrocket in price, only to subside and form a new support level. Imagine please the horror on the faces of people invested in bitcoin. Each time, overnight so to speak, it became almost worthless.
Observe also, how from today's point of view, those past events seem insignificant to those of us who were not involved back then. From our perspective, it's nothing but exponential growth.
Contemplate now, just for a moment, of some future investor, someone like you and me today, looking at the bitcoin crash of 2017/2018. It would seem to that person, as it seems to us today, that nothing could hinder it's growth (to the moon anyone?)
For those of you reading this, writing this post took far more time than I anticipated. The story will continue with an update in the following days. I do expect bitcoin to increase in value tenfold, more than once, in the following years.
But let us be realistic: We have seen the ten fold increase from the previous crash support level. All that is needed for the next big crash, is a catalyst, which I believe has been identified. More on that in the next part.
Thank you for reading, please consider subscribing and resteeming.
Ante
This a good start to your blog.. I wish there were more traders blogging and expressing thier ideas on steemit.
I know, the bull trend has been going on for a year, and a lot of people forgot that every medal has two sides. I will start writing regularly, and try to keep the quality up. Thank you my friend, for supporting me this early. It means the world to me.
In the last bear market, Steem got all the way down to .08 cents.. I should have loaded up anywhere in those levels, and today I would be a whale, and have big voting power, but I still have never invested in steem. My steemit wallet is only what I have received from my posts.. So in the next bear market, I am planning on buying steem and adding to my steem power. I love this platform.
Will see if it happens again. I personally dont hold bitcoin at all other than the dozen i mined back in 2009. Rather invest in something I actually use like steem..
Thank you for the reply Kevin. Yes I agree, value investment is the best kind of investment.
Welcome my friend ;)
I totally agree with your view, but I think now the correction would be sharper and shorter... I think we would see another bull trend starting somewhere next year...
looking forward to the next part!
Thanks for the post Ante. It is good to see historical charts with explanations. I am confident cryptocurrency is here to stay but we will have to see who is the ultimate winner. Also, being aware that it cannot go up forever (even though at times it seems like it) is great for an active trader.
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