BITCOIN The ultimate BUY ZONE on the road to $200000.

Today I want to bring forward an important Buy Zone I came across. It is a combination of Bitcoin's key cyclical trend lines and the MACD on the 1W chart.

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At this point I need to mention that this study was inspired by this chart made by the community's esteemed member VovaNapas.

** The Cyclical Trend-lines **
As you see on the chart there are two key trend-lines on each of BTC's three Cycles:

- The one in red displays the Resistance trend-line of Lower Highs that start from the peak (All Time High) of each Cycle and ends once Bitcoin breaks above it with a sustainable series (candle closings) of candles. This trend-line contains the Bear Cycle in it as well as part (or most) of the Accumulation Phase.
- The one in green displays the the Support trend-line of Higher Lows that start from the time the price breaks above the Lower High (red) trend-line and ends until the Cycle's peak (All Time High). This trend-line contains the Bull Cycle as well most of the Bear Cycle.


** The Cycle's Best Buy Zone **
So if the green line contains most of Bitcoin's sequence which part of the trend it doesn't contain? Well this is the essence of the current study and in my opinion this is the most important part. As you see on the chart the area outside of green lines is the one with the blue Ellipse. This Ellipse is the region below both the red and green lines and represents the Best Buy Zone of every Cycle. Why? As you see it is the area starting after the green line breaks and before the price crosses above the red line and (practically) start the new Bull Cycle.

In other words we can say that it is the area after the worst of the Bear Cycle is over (and the Bottom is made) and the area before the new Bull Cycle starts. What more can a long term BTCUSD investor want? The trade with the lowest risk (price completing the decline with a Bottom already in place) and highest return (before the new Bull Cycle starts). This is why I call this Ellipse as "the Cyclical Best Buy Zone".


** The LMACD Pivot Zone **
On top of that, our very accurate LMACD indicator offers a unique Buy Signal when being traded on the current levels after the Bottom is in. As you see on the chart, after every Cycle bottom the LMACD rises and (in the first two Cycles) pulls back quickly for a retest of the -0.10/-0.05 region. This is when the price makes a Low (Higher Low on the Bottom) and then a Parabolic Rise to the new All Time High starts. I call this region "the LMACD Pivot Zone".

Now we can argue that this time (meaning on the current Cycle), the LMACD rose initially very aggressively without pulling back to that Zone. Well it is no surprise that the market made that violent correction since the June 2019 High, and is right now testing the LMACD Pivot Zone for the first time since it broke it in April 2019. Why it took is so long to re-test it? Could be due to Bitcoin's Lengthening Cycles Theory which I have analyzed in the distant past (and I think it is time to do again on my next ideas).

Regardless of that, I believe it is no coincidence that the re-test of the LMACD's Pivot Zone is taking place now that the price broke below the green trend-line and has essentially entered the Buy Zone of the current Cycle.


** The Fibonacci extension application on the Cycles **
An interesting characteristic of Bitcoin's Cycles when those trend-lines (red and green) are applied is that every break-out from the red line roughly has the same distance from the previous peak (All Time High). To put that into perspective, as you see on the chart the start of each bull run is at 0 Fibonacci level, the peak of the Cycle is at 1 and the time the red trend-line breaks is roughly the same distance (with some variations). The 1st Cycle ended on the 1.9 Fibonacci extension, the 2nd ended on the 2.1 (+0.2 from the previous) so it is natural to assume that the 3rd will end on the 2.3 (+0.2 from the previous) which times it on October 2020!


** Aiming $200000 on the next peak **
Where can this Buy Zone lead to? According to the decreasing rate of -50% on the difference from every Higher High rise (1st Cycle = +3450%, 2nd Cycle = +1700%) then the 3rd Cycle should peak at -50% of the 2nd i.e. 1700% / 2 = +850%. Which numerically makes a peak at $200000.

On the charts below you can get an initial idea of the Lengthening Cycles Theory and see how Bitcoin is still within the trend-lines of the Parabolic Growth Channel which I drew over 1 year ago (January 2019)!




It is more than obvious that the long term bullish (parabolic) trend of Bitcoin is intact and traders simply got over-excited last year from the April - June excessive rise which was outside the long term models and was purely due to very bullish news (quicker adoption, Libra etc etc). The long term investor can still seek to accumulate more as we comfortably get ready for the Halving event and the official start of the new Bull Cycle this year.


Do you agree that the current price range represents the "Best Buy Zone" of the current Cycle? Maybe you have an alternative buy spot or simply a completely different argument? Feel free to share your work and let me know in the comments section!

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