Bitcoin Past Crashes and Possible Trajectories

BNC:BLX   BraveNewCoin Liquid Index for Bitcoin
Every time Bitcoin went parabolic, it will crash and have it corrections. The length of the crash and consolidation period depends on many factors.

One of the factor is how fast the price can recover and maintained at higher prices, we can see this during the early 2013 crash when Bitcoin recovers quite fast and went to another parabolic move at the end of 2013. However, the longer Bitcoin unable to recover, or the deeper it goes down, the longer it will take for Bitcoin to recover to its all time high. The 2011 crash took almost 20 months from Bitcoin . The 2013 crash took 3 years for Bitcoin to recover. Notice how the price of Bitcoin drift lower and lower as it unable to make a new important high to bring it back to the game. Also notice how when the RSI goes below 70, Bitcoin went into a much longer consolidation period. The RSI did not dip below 70 for the early 2013 crash.

The 2011 crash was catastrophic 90% drop from all time high while the two 2013 crash was a 80% drop from the all time high.

So, whatever Bitcoin -5.40% trajectories will be in the future of 2018 will depends on its ability to recover and rebound. If Bitcoin drops 80% or 90% and unable to rebound, we might be into a multi year bear market. However, if Bitcoin can rebound from the current level (7-8k) and immediately go to 15k, then this consolidation period may be shorter and we can expect to see another all time high by end of this year or early 2019.

February, March and April 2018 will be an important months because the candles and closing of these candles will guide us the trajectories Bitcoin will take in the future.

I will update this at the end of every Month closing.
Comment: Some perspectives. The yearly chart of Bitcoin tell us a lot of things.

Links to yearly chart:

First, we had four green candles from 2010 to 2013 which is a massive move by Bitcoin.

Second, we had a consolidation period from 2014 to 2016. The candles of 2014 to 2016 is relatively small compared to 2013 and all of them close at the upper region of the 2013 candle body.

Third, 2017 was a another big green candle. It is expected that 2018 might be a consolidation period or consolidation candle just like 2014-2016. We will see. Also, it is important that we do not close 2017 below the middle body of candle 2017 which is around 4000 USD.

Another perspective is from the Quarterly chart.

Characteristics of an uptrend is the ability to make higher high and higher low. That is what exactly happened during the 2016 and 2017 period. It is important for Bitcoin to not close below the low of candle 2017 Q4 which is around 4000 USD. If 2018 Q1 (March 2018) close below 4000, then we are making a lower low and lower high for the first time since 2015.

Also, a big green candle followed by a bigger red candle is never a good sign. It can be considered as "reversal" and we might be heading into a danger zone. The biggest red candle happened on 2011 Q3 where Bitcoin consolidates for 20 months before the 2013 bull run. However the 2011 Q3 candle didn't close below halfway of 2011 Q2 body, which is a good signal, and then it is followed by a hammer which creates a new bottom for Bitcoin.

Overall from the longer time frame perspectives, we want to see Bitcoin bottomed at a relatively higher price in 2018 Q1 (by March) and we want to see Bitcoin reverse the course by producing a hammer or a green candle on the quarterly chart.

At the moment, March closing will be the most important one. A weak closing by March may prolong the current bear market and put us in a very dangerous territories.
The majority of big moves have already been made from 1000 USD to 20000 USD, that was the "easy" money part. Now is not the easy part. Bitcoin has crashed 70% from the all time high and it will be volatile and treading sideways for sometime now. That is why I don't have any positions in BTC except for buying on dips, oversold. Anyone trying to chase here will be slaughtered and killed. The good time is already over for now. Just face it.
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