peter-l

Will Bitcoin's 2022 be better?

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar

2021 has passed, and the world has been in unprecedented turmoil for the past two years, with epidemics, rivalries and seemingly no timetable for an end. I hope 2022 will be better, but I still don't see much light. Although the chaos will end, we cannot ignore it.

Over the past year, even as the world was in turmoil, financial markets seemed to be safe havens. The U.S. stock market is leading the global bull market, and the coin market has welcomed more institutional investors, recording a record 60% gain from its low at the beginning of the year, the launch of ETFs, and El Salvador's declaration of Bitcoin as its legal currency.

This may be the bright future that many people expect, but there are also many hidden dangers behind it. Whether it is the direction of Musk's tweet or the intensified regulation in China, we see the growing risks in the market.

In the past year, many things have happened. If I could explain them in detail, I would not be able to finish them one day and one night. I believe many people will sum up some events, so I will not repeat them.

Chart analysis is something I'm good at, so let's go back to the chart.

Bitstamp is the market's longest-kept exchange, so we used this chart to analyze the current movement.

The premise of chart analysis is that we believe history will repeat itself, and we also believe that the chart contains the movement of prices. Based on the above points of view, we have the significance of the following analysis, if you do not agree with the above points of view, it is recommended not to read.

First of all, we have seen three bull markets in bitcoin's history. The data of the first two bull markets were 510 times in 38 cycles and 120 times in 52 cycles respectively. The current third bull market has run 52 cycles and gained 21 times.

Second, we look at the bear market of the correction. The first is 21 cycles, a correction of 86%; The second is 18 cycles, an 84% adjustment.

Third, we all know that markets can't go up forever, so bull markets must end and bear markets will come. Right now, I think the biggest disagreement between bulls and bears is whether the bull market is over.

1. By comparing cycle attributes, according to the principle of symmetry, I believe that the 52 cycles of this bull market are symmetric with those of the last bull market, meeting the cycle demand.

2. For the first time in history, the 3-week MACD shows a peak divergence. Judging from the MACD adjustment properties, there should be no less than 6 correction cycles. Neither of the previous bull markets had a correction of more than five cycles. After six cycles, it's a bear market.

3. If a bear market cycle has already started, based on the symmetry principle, I assume an 18-cycle correction of around 84% and the correction target should be around $10,000.

4. Of course, this hypothesis also considers other factors, such as the participation of institutional investors, which may reduce market volatility .

The second bull market was a quarter as big as the first, and this one is now one-sixth as big. In addition, the participation of institutional investors may lead to lower volatility


Fourth, if you understand the above analysis, the rest is simple, we just need to determine if the bull market is over.

1, fundamentals, the current bullish people, think that inflation leads to the choice of Bitcoin as a hedge tool, bearish people, more consideration is regulatory issues.

From an inflation perspective, does the increased likelihood of fed rate hikes mean the logic of fighting inflation will weaken?

On the regulatory side, China, South Korea and Russia have all proposed strict regulatory policies. India and the European Union are contemplating austerity, while the United States is perhaps the least explicit. But I don't think governments will be able to let go of digital currencies if they do affect financial stability. Whether it can do so is another question.

2, technical, this is the simplest, if a new high is made, it will certainly not be a bear market, another support level , is the previous low around $28600, if the breakthrough there, double head formation, will also be a signal. But that may not be a good strategy for long positions that still hold a lot of chips, because by then the losses could be substantial.

3. Other factors

There is some truth to this logic, but it is not absolute. The correction in the US stock market is not small, mainly because of the proliferation of financial derivatives. Institutional investors have enough hedging tools to make money shorting the market. Moreover, derivatives were born in the currency world, so I don't think institutional investors are necessarily responsible for the decline in amplitude.

Some say the supply of bitcoin is stable and inflation resistant. That logic seems plausible, but only if bitcoin becomes truly digital gold . As far as the market is concerned, bitcoin is just a speculative target. From a supply and demand perspective, while the total amount of Bitcoin is manageable, there are so many derivatives transactions, including CME's dollar contracts, that the so-called limited total amount of Bitcoin is not valid. In particular, cME's dollar-traded bitcoin contracts, which allow even people who don't own bitcoin to make huge profits on bitcoin fluctuations, are a good example of the greedy nature of "Wall Street."

With all that said, I hope you're cautious about 2022. Especially for those who use leverage, or those who invest with borrowed money, what's the point of betting all your money on fish's tail?

有人觉得我只是提示风险,很少提示机会。其实这个市场,盲目看多,缺乏风险意识是多数人的特性。如果我提示看多,不过是锦上添花;但提示风险,确是雪中送炭。
需要每日分析,请搜索微信号peter-tqbj,获取免费试用机会。
Disclaimer

The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.