If you found yourself wondering why BTC has done nothing but chop back and forth for roughly a month now, look no further. This represents the absolute last remanence of the current uptrend.
This support holding has not been my base case for BTC as I've expected the price to find itself at least to the 200W MA for quite a long time now.
Something important to note is that this channel is only reliant on considering the Covid low to be a valid point on the chart.
I think an argument can be made that since it was a complete Black Swan Event (Outlier) it is reasonable to take the next valid point which would be here:
As you can see it paints an entirely different picture, but again, I think validity is up for interpretation here.
One thing I must note which I think is very important is the comparison to previous Bull Runs. If you take a look at the chart; it shows you the strong rejection BTC had right before breaking out leading to a blow off the top (May 2021). Every cycle in the past led to a parabolic rise when this channel was broken and when this time it wasn't, the market was confused. Market makers thought they could squeeze a bit more out (which they did) since we didn't see that blow off the top and BTC bounced once again in July 2021.
My overall point here is that this shows us there is real suppression in the markets. There are Cyclical Forces in the mix. Something greater than FED Policy because remember, they are only reactionary. If the market didn't force them, then they would have never acted. So they are only a pawn on a big chess board. I speak of the FED because their policy affects the stock market, which in turn affects Crypto.
It seems like many don't know this, but it is the same big entities playing both markets. The same big money that front-run stocks, also (Id argue more precisely) front-run Crypto.
The World Economy is in a very rough state. Between Geopolitical tensions, Supply chain issues, soaring energy prices (Gas at $5.00), Inflation still raging, Food Crisis, etc, many people's lives are truly being affected.
Many people can't even properly afford to live their lives and keep a roof over their heads, not to mention the ones who are still trying to are maxing out their credit to keep up. Total Revolving Credit is historically at an all-time high (look it up).
Over the last few years, there has been an unpreceded amount of crisis. The rich are able to capitalize on these opportunities and the poor get to suffer the consequences. The wealth gap we see today has never been greater in our lifetime and honestly beyond. There will be consequences to pay for this wealth gap that has completely erased the middle class.
To put it simply It's been surprising to see price hold for some long in this area without breaking up or down. It shows just how much uncertainty there is.
I can make a strong argument why we will not see strong long-term moves to the upside for quite some time but that is not what this post is for. That will come with a follow-up post.
For now, I just want the chart to speak for itself and plead its own case without noise. While touching on a few things I consider important.
I understand this is an extended post, but I think it is important to expand our perception and understand the broader fundamentals because ultimately all the dominoes fall in order. Once you understand this, seeing the big picture instead of the small one becomes easier.
The last thing I'll say which I think is the most strange of all, pay attention to the bottom left of the chart. Notice that extended wick at exactly November 21, 2011? Isn't it really strange that one wick represented the exact top and bottom of this channel? Can't really wrap my head around that one.
I know you think the 200 week SMA is the ultimate low Bitcoin can go but this is only logical with the old mentality of cyclical events in Bitcoins history. You do describe here, which is correct, that this is the first time Bitcoin has not made a parabolic move to top the cycle and was rejected. This brings me to the fact that you can not base the 200 week SMA that has always worked in the past as support when you acknowledge the top for Bitcoin is completely different this time around for the first time in all history. You can’t have it both ways. My conclusion is to look elsewhere for support around the $10,000 - $18,000 range.
NoOneWhoIsSomeone
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@crowntrade, Honestly your argument is sound and I 100% agree with it. I think my target of 200W MA got lost in translation. I made such a deal about it because, at the time, it simply hasn't happened before. If you thinking in terms of chance/odds, it shouldn't be your first bet to go against the trend. This is why I didn't want to assume it would just break right through it. Now that we have arrived here and endured the last few weeks, I am more than willing to pivot. I should have probably already updated this to clear any misunderstanding but I've been so busy. Hopefully, you saw my newest post on SPX, it would give you a good outlook on my sentiment personally. I do not think the pain is over yet! Thank you for checking me and giving me your honest take. It is really appreciated! You are arguably my favorite person to comment!
crowntrade
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@NoOneWhoIsSomeone, Thank you, you have great analysis and I am happy we have come to a sound agreement on such a hot topic.
NoOneWhoIsSomeone
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@crowntrade, "I personally do not believe it will go that low, I remain firm on my target of between 22-23k or 200W MA." Thats what I said last time you mentioned this, and I will admit I spoke in terms of absolutes and I shouldn't have here. Also notice how I said "as I've expected the price to find itself AT LEAST to the 200W MA" in this post. I was already expecting lower at the time of this post lol I will work hard to get a good update out tomorrow
BTC has been taken over by all the whales and those same people that control and front-run the stock market, right, Virtu Financial a-wholes? The retail trader has no chance at this game, never has and never will until the system is destroyed along with them.
NoOneWhoIsSomeone
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@Free_Loader, Retail traders are definitely the pray there is no question about it. Crypto is still small enough to control the tides but yet big enough to ride the waves.
scratchticket
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I have only one chart posted and it has a similar view. Take a peek if curious.
Thanks for the observations. In re: 2011 wick, an argument could be made that it just reinforces the upper and lower bounds of your channel (or is an antecedent thereof). BTC had fairly low volume in 2011, extremely high optimism coupled with frustration with the larger economy ... oh, and then there were the whales, at least some (I'd guess most) of which were non-institutional. When I got into crypto in 2012, they'd inadvertendly and sometimes intentionally make quakes.