As I showed in a previous analysis, BTC is setting up for a major retracement to the rising blue arc. The vertical red trendlines correspond to NVT sell signals on the weekly chart. Almost every single NVT sell signal has resulted in a decline of 70% or more, aside from the one that occurred in November of 2018, which resulted in a 52% fall. I believe that decline was reduced, because it happened toward the end of a bear market. This latest signal, came after a 330% rally, which leads me to believe that the correction could be severe.
In addition to BTC being under pressure from the NVT sell signal, price has fallen below the 50 day MA (in orange) and the 200 day MA (in purple.) Looking at the chart, you can see that for the past couple of weeks, BTC has been trying to get back above the 200 MA, but it has failed each time. This is incredible weakness that we haven't seen in the beginning or even the mid stages of any BTC bull market in history. So, provided BTC doesn't print a sudden recovery above those moving averages, I'm becoming increasingly confident that we're about to see a major fall in BTC.
This isn't the first time I've said that. I published a chart in May, showing why I felt that BTC was in a bear market rally, which literally nobody else was talking about at the time. At the time, that analysis got a lot of negative feedback, but I may be the one with the last laugh in the end. Admittedly, my timing for when I thought the retracement would be was a bit premature, but it appears to be happening nonetheless.
So, we have an NVT sell signal playing out, which historically has yielded corrections in the 70% range. That takes us right down to the regression arc, which I've been saying NEEDS TO BE TESTED, before the next bull market. We never tested it. So, I still believe that the rise to 13,800 was a bull market rally, and the evidence is mounting to suggest that BTC is poised for an epic fall.
People are way too bullish. Everyone thinks that they're going to be millionaires in a few years because they threw some money into crypto. What's really going to happen, is crypto is going to chew up and spit out the weak hands first. It's going to grind your faces into the pavement, and destroy your short term dreams, until you waive your white flags and run home to your Mommies.
Nothing is guaranteed. Bitcoin's log chart is the most beautiful chart I have ever seen, in my 11 years as an analyst, but there is no guarantee that it will last forever. The truth is, Bitcoin is an inferior technology to other solutions (like XRP) and there is very little (if any) adoption or real use of BTC. It can't scale, transaction fees explode when the blocks fill up, the lightning network is a mess, it has no real use case other than a "digital gold/store of value," and it lacks consistent innovation. It's over 60% centralized to China, it's TPS speeds are slow, someone owns 1/17 of all coins in circulation and, unlike Ripple, there is no protection in place (like cryptographic escrow) to ensure that they don't dump those 1,000,000 BTC on the market. Did I mention that it consumes more energy than small countries, even at it's currently relatively small market cap and network size, compared to other global markets? It's extraordinarily inefficient. BTC needs trusted third party solutions like the lightning network, but the "trusted third party" part is the antithesis of what BTC stands for. To paraphrase David Schwartz, second layer solutions such as the lightning network are inhibited by the deficiencies of the base technology.
Despite those negative points, BTC's log chart is still the most beautiful chart in existence. Despite those negative points, BTC could still rise to ridiculous prices. It has a very recognizable brand, it has the staying power that no other crypto has exhibited, there is also a lot of economic uncertainty in the backdrop that could be a boon for BTC and crypto. However, BTC is currently poised to test the resolve of everyone involved in this space. Everyone thinking that it will rise from the ashes, even if it falls back to the regression arc, could be unpleasantly surprised to find a breakdown below this rising blue arc, and an abysmal fall to worthlessness. Time will tell. The question is, if we fall from here, are you willing to hold to 5000, 4000, 3000 or lower? There is no guarantee that a recovery will come. I know that sounds grim, but I call it how I see it. The regression to the arc never happened, and BTC is showing that it may be setting up for that regression. If/when we get down there, will we recover? History says yes, until it doesn't. Personally, I do think there will be a future for Bitcoin, but the road to new all time highs won't come as easy as most investors think.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
Comment
⋅
Here is the analysis where I said that BTC was in a bear market rally.
@dralerte, trading opposite position of most active and followed authors does seem to be the way to go. So illiquid market, TA hardly means anything in the wild West. It only takes one fat finger order ti catalyze bot script nation
NecRose
⋅
MagicPoop is always wrong.
It’s safe to open at least 5x long here and enjoy the gains.
MagicPoop is going to get REKT. Again. God bless the Bitmex liquidation engine. Yaooo Let’s take MagicPoop’s money everyone.
Long it.
controllinghand
⋅
Hi Magic, I appreciate your views and post. I follow you. You bring up some great points about Bitcoin tech. However, best tech doesn't always win. Take VHS vs Beta. It's more about adoption than anything.
Value in USD transfered:
coinmetrics.io/charts/ Just yesterday 6 Billion in USD for BTC vs 180 Million in USD for XRP
There are other cryptos that are demonstration more transaction than XRP. For example EOS.
coinmetrics.io/charts/ 5 Million transactions for EOS vs 800 thousand for XRP
The thing that XRP has going for it is backed by big banks. But part of the crypto movement is to be your own bank. This is why some people still have Gold and Silver. If they trusted the government and banks they would sell it all for USD.
This is a great time to be alive. We get to see this all play out. No one really knows what is going to happen but I enjoy the ride.
Keep doing what you do.
Thanks,
~Controllinghand
AIMORAN
⋅
In your last idea you were talking about $20,000. Who still believes in you?
MagicPoopCannon
⋅
@AIMORAN, ... Practically everyone on this site, which is why I'm the most viewed analyst of all time here. Regardless, I couldn't care less about what you or anyone else "believes in."
Jeff_Cryptopop
⋅
@AIMORAN, We could always go to 20K again at some point but that 13800 many called as the top of this rally was the underside of BTC's long term trend line that was broken last November. Now it's been tested as resistance.
streetgainer
⋅
"Admittedly, my timing for when I thought the retracement would be was a bit premature...."
LOL!!!!
It went from $5800 in May when you claimed you "sold all", straight to a high of $13,800 which was at a precise fib level and you call that timing premature? It's more like delusional. You literally missed the most obvious ascending triangle being built with higher highs and higher lows. In other words, you were flat out wrong.
Even if it goes to 3k from here, your "so called" exit at 5.8k missed a 137% run. What last laugh can remotely come from that?
p.s. please, no lies about you shorting.
F6-PFCEF
⋅
really? BTC inferior to XRP? And you call yourself an analyst? Inferior to what extent?
P.S. You’re welcome ;)