Bitcoin Bubble Comparison - 3 Day Chart

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
On September 5th I made a similar post comparing the daily chart to the 128 MA. It is much more detailed, however the conclusions didn't change much.

The TL:DR of the previous comparison reads as follows:

Bottom: $2,860 on October, 31st 2018
Range: $3,750 - $5,800 for 8 - 9 months
Breakthrough: $6,100 on June 21, 2019

Because the RSI is not oversold and we are in a tighter coil than last time I expect a faster selloff and therefore a faster rebound. That may or may not mean that the price will go lower, that will depend on support, it does mean that I expect the target to be hit faster than the 1:1 comparison that I did on the chart posted above. There is no way to tell how much faster so I am going to stick with my prediction from the previous bubble comparison, for at least another week.

Only continue from here if you are interested in my subjective view of the fundamentals about the USDT' situation.

I almost always stick with technicals, because I believe that they reign supreme ~99% of the time. I believe that if there is news that will affect the market then it will be seen in the charts before it will be heard in the news ~99% of the time. I think Tether' is a very good example of that, there was a major selloff without the news that I would expect to back it up. There is always FUD' surrounding USDT' about banking relationships, Bitfinex, unbacked Tethers' etc.

However, USDT:USD' has never broke 0.8897 in it's ~18 month history on Kraken and it fell to 0.85 on Saturday night. We have also never seen such a drastic premium on USDT' exchanges when compared to USD exchanges as far as I am aware. To me this represents big money making big moves, which would suggest that insiders know something we don't.

There is a very good chance that I am wrong about that, and I will certainly not be making trades based on loose suspicions. However, I am trying my best to understand the situation and that is what makes most sense to me. Once I feel like I understand the underlying fundamentals of the market then I can get back to doing TA.

I do believe that Tether is single handedly driving the crypto market right now.

The premium remains on the USDT' exchanges and the USDT:USD pair remains in dangerous territory. If it cannot close above historical support of $0.98 in the next couple days then it will be ripe for another selloff. If that does continue to fall then I expect BTC' to moon on USDT' exchanges. This last pump came on Tether losing 14% of it's market cap and 12% of it's USD value (at it's low).

At it's peak, that added 16% to the value of BTC:USD' + BTC:USDT' / 2

Therefore it is clear that a flight to safety from USDT' to BTC' would also cause people to FOMO in with USD. If Tether' were to legitimately go to $0 then there is no telling how high that would pump the price of BTC:USD' or BTC:USDT'. However, once people ran out of USDT' then there would be very few buyers at the inflated prices and a sharp reversal would be expected.

If insiders had information then they already made there moves and now there could be a situation where I put technicals to the side. All TA that I have done would suggest that > $8,500 BTC' would = the next bull market. Before this weekend I would have been very confident in becoming bullish on Bitcoin at a price above $8,500. Now I would hesitate very much to make that same claim unless USDT:USD was ~1:1 on Kraken or unless the price stayed there for a month or two.

I am currently shorting USDT:USD at $0.97. I view this as a very safe trade while waiting to buy back into BTC'. It everything stabilizes then I should be able to breakeven by buying back at support. If not then I have orders set at $0.85 / $0.75 / $0.5 and $0. 01 to cover 25% of my position. While waiting for BTC' to figure itself out I think this is a great way to put my sidelined fiat to work.
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Tether and Bitfinex is Mt.Gox 2.0. Great TA as well. Bear markets always end in massive sell offs. RSI has yet to fall below 40, there will be another capitulation once we break downwards from the descending triangle.
+2 Reply
Hi mate, great TA and analysis as always..I have 5k of USDT should I buy BTC now, please advise, cheers Glenn
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