*For the best introduction for Bitcoin cycles, please visit the Youtube channel of Bob Loukas, who was the first to discuss Bitcoin's 4-year cycles back in late 2018.*
Since reaching a price of $64,899 back on April 14, 2021, Bitcoin has dealt with China clamping down on mining operations and essentially reducing their country's hash rate to zero, aside from underground miners operating illegally.
In order to absorb the massive selling pressure caused by the exodus of miners from China, Bitcoin needed to experience what are called "left-translated" cycles.
Left-translated cycles have more days of price going down, than days of price going up. The price top during a left-translated cycle usually occurs within the first week or two after bottoming. The recovery is swift and violent as "buy the dip" mode is in full force. This type of 60-day cycle occurs during downtrends/corrections, as investors buy the heavily oversold asset when retail investors panic sell their positions and get washed out.
In the chart above, you can see that Cycles #19 & #20 are great examples of left-translated cycles. From May 19th to June 20th, Bitcoin was able to consolidate as the hash rate was redistributed to other miners around the globe, resulting in higher margins for them.
Once the left-translated cycles absorbed enough oversold Bitcoin from weak hand sellers, the uptrend was able to resume and the trend shifted to "right-translated" cycles.
Right-translated cycles have more days of price going up, than days of price going down. The price top during a right-translated cycle typically occurs after 45-50 days. The beginning of the cycle is very slow and methodical, as smart money accumulates the asset during quiet times before a breakout invites emotional, retail investors back into the fray. This type of cycle occurs during uptrends, as higher-highs and higher-lows are formed.
In the chart above, Cycles #21 & #22 are great examples of right-translated cycles, as each increased roughly 75% over roughly 50 days of upward price action.
Bitcoin has been experiencing consecutive right-translated cycles since July 20, 2021 and is attempted to remain above $42,333, in order to resume the uptrend. Omicron fears back on December 4th attempted to derail the uptrend, but Bitcoin has remained strong and has not formed a lower-low.
An attempt to break out of the downward channel we've been trading in was interrupted on December 27th, causing Bitcoin to once again consolidate within the channel to regain momentum.
As the new year begins and tax harvesting season is behind us, I believe Bitcoin will break out of the channel in the near future and resume to uptrend of right-translated cycles until mid 2022 when the top will most likely occur.
If you bought during 2021, I encourage you to think long term and zoom out to get a sense of the repetitive cycles that Bitcoin goes through on a 50-60 day timeframe. Identifying which type of cycle we are in, will go a long way in determining whether Bitcoin is in an uptrend or downtrend.
This type of analysis is just scratching the surface for cycles and I look forward to sharing more if people find this information easy to understand and helpful. Let me know what you think, since I am new to sharing my analysis on TradingView, thank you!
Since reaching a price of $64,899 back on April 14, 2021, Bitcoin has dealt with China clamping down on mining operations and essentially reducing their country's hash rate to zero, aside from underground miners operating illegally.
In order to absorb the massive selling pressure caused by the exodus of miners from China, Bitcoin needed to experience what are called "left-translated" cycles.
Left-translated cycles have more days of price going down, than days of price going up. The price top during a left-translated cycle usually occurs within the first week or two after bottoming. The recovery is swift and violent as "buy the dip" mode is in full force. This type of 60-day cycle occurs during downtrends/corrections, as investors buy the heavily oversold asset when retail investors panic sell their positions and get washed out.
In the chart above, you can see that Cycles #19 & #20 are great examples of left-translated cycles. From May 19th to June 20th, Bitcoin was able to consolidate as the hash rate was redistributed to other miners around the globe, resulting in higher margins for them.
Once the left-translated cycles absorbed enough oversold Bitcoin from weak hand sellers, the uptrend was able to resume and the trend shifted to "right-translated" cycles.
Right-translated cycles have more days of price going up, than days of price going down. The price top during a right-translated cycle typically occurs after 45-50 days. The beginning of the cycle is very slow and methodical, as smart money accumulates the asset during quiet times before a breakout invites emotional, retail investors back into the fray. This type of cycle occurs during uptrends, as higher-highs and higher-lows are formed.
In the chart above, Cycles #21 & #22 are great examples of right-translated cycles, as each increased roughly 75% over roughly 50 days of upward price action.
Bitcoin has been experiencing consecutive right-translated cycles since July 20, 2021 and is attempted to remain above $42,333, in order to resume the uptrend. Omicron fears back on December 4th attempted to derail the uptrend, but Bitcoin has remained strong and has not formed a lower-low.
An attempt to break out of the downward channel we've been trading in was interrupted on December 27th, causing Bitcoin to once again consolidate within the channel to regain momentum.
As the new year begins and tax harvesting season is behind us, I believe Bitcoin will break out of the channel in the near future and resume to uptrend of right-translated cycles until mid 2022 when the top will most likely occur.
If you bought during 2021, I encourage you to think long term and zoom out to get a sense of the repetitive cycles that Bitcoin goes through on a 50-60 day timeframe. Identifying which type of cycle we are in, will go a long way in determining whether Bitcoin is in an uptrend or downtrend.
This type of analysis is just scratching the surface for cycles and I look forward to sharing more if people find this information easy to understand and helpful. Let me know what you think, since I am new to sharing my analysis on TradingView, thank you!