Crypto Analysis | Bull market Top has shifted to 2022

in LeoFinance3 months ago (edited)

Good day Hiveians!

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In the last post Bear market or middle of the Bull, I argued that we were in fact still in the middle of the bull market rather than already being in bearish territory

The main reason for why I thought that we were in a late phase of the bull market was the fact that the main channel (seen as the yellow lines here) and which corresponds to the middle of a bull market has been breached in the "Musk Rally" earlier this year. Without Elon Musk's announcement I was arguing for the main pattern seen in the chart below (the black line).

Since this channel was never breached before without triggering the late phase of the bull market I reasoned that this was also going to be the case this time. However, prices have also never broken into this channel in a bull market. With this being the case now we have two options: the bear market is upon us or instead, we are still in the middle of it. It has become quite clear to me that the latter is much more likely. And there is a very simple reason for this: time!

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There simply hasn't been enough time for the top of the bull market to have occurred yet. A very good indicator is the halving events roughly every 4 years which are marked with the vertical lines in the chart below. As you can see the second bull market occurred after the first halving event 364 days later. The third bull market top happened 532 days after the second halving event. The bitcoin market is clearly extending horizontally as well as vertically. This means that every next market top should come in at a later time. Extrapolating this (non linear) trend would give us a range of about 776 to 960 days for the next market cycle top. This corresponds to a 46% to 80% extension.

btb.jpg

The recent highs of 60k+ would have been clearly too early and too low to have been the top of this current cycle. I think this is very evident when one looks at the chart above.

The "Musk Rally" therefore constitutes a "fake out" and we should expect prices to go as low as 20k (although I think ~23k is more likely) before finally transitioning into the late phase of the bull market.

The peak of this cycle is yet to be determined, but I think it could be anywhere from 200k to 500k. It is important to keep in mind that with the bitcoin cycle maturing, the cycle tops will be less and less dramatic.

 


As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!

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However, prices have also never broken into this channel in a bull market.

The problem with this assumption is that the sharks have never capitalized on a previous mega-cycle to liquidate all the longs given that pattern that everyone was loading up on debt during the 30%-40% retrace. The market spotted this attack vector and fleeced all the longs by dumping the market twice in a row.

I have to agree, this is all about time, but it might be a mistake to base these assumptions on 10 days of price action for a thing that's never happened before. A ten day correction is being assumed as the end-all bear market. That's pretty thin. The market has to move lower than $30k for confirmation, but the catch-22 there is that once we get to $20k we are back in a bull market again, so there isn't a lot of wiggle room to turn a profit with trades.

For me, a huge run in summer 2022 is looking much more likely, but I'm still not sure.
I think the next few weeks can tell us a lot: like how much momentum is left (if at all).

Correct me if I wrong, but even by your own calculations we are pretty much already at the bottom ($30k). All in all I'd say this analysis looks pretty good. Gonna reblog it.

true, the market and macro situation is always changing. The main idea here is that patterns repeat in a similar enough way to make somewhat sensible predictions. So far it has worked very well; but of course that is not a guarantee for the future. What jumped at me when I looked at the market from the perspective of the second chart was that it was simply much too early for the market to already top out in the next months.

30k could be the bottom, but prices have generally gone back down to the support line. Together with the previous top of 20k I think that the lows could be at around 20-23k. This would also mean that there would be a sideways movement until about fall/winter

also there is a big resistance from the trend line here:

bbbd1.jpg

not to mention the head and shoulders pattern

Nice to see, I had the same thoughts especially as regards the pricing in of the halving in this post

https://hive.blog/hive-167922/@mistakili/has-bitcoins-halving-been-priced-in-what-if-it-hasn-t

So this post corresponds a lot with it, glad I’m on the same page

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great, glad to hear I am not alone ;)

I agree that we are in a bull market.

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would you agree with the general outline presented here?

Looks good, have to get in a new long entry at 23k then :)

Yes, I think there are predictable patterns here, from which we profit, but as all things there are surprises.

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I disagree. I still think the top is in 3-4 months at around 200k.

This is a crazy prediction but I don't see it playing out differently.

what's your line of thinking?

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