David Bowie wrote an amazing song called Big Brother which I will place a link to in this commmetary. In it he cynically sings about how in the book 1984 by Orwell the people actually WANTED Big Brother to save them. The album which the song is on is called Diamond Dogs and is one of my favorites. Fairly apocalyptic and amazing.
OK, the charts. As you can see we had a very big drop today as Congress holds some messed up hearings on Bitcoin . You’d think the speakers had been personally touched in innapropriate places the way they were bashing cryptocurrencies. We’ve had hearings before both good and bad and they affected price up and down. Excuse me while I yawn.
As I mentioned before, the TD count was getting close to reaching 9. (These are the little numbers near the candles). And I said that once we reach 9 we are getting ready for a bounce up. So today is a NINE!! YES!!!
Next we look at the fibs from the top of the market to the market low and you can CLEARLY see we have reached the red zone where we are very oversold.
pointing down along with showing weakness, so more downside is possible, but probably short lived.
50 MA is closing in on 200 MA, not a good sign but a place where rocket reversals have occurred. 50 is still pointing down showing trend is down.
So obviously a bit of a mixed picture. Waves (Not shown) put us in an area of reversal as mentioned before in previous charts, somewhere in the 8000-8500 level which we are currently in, but for safety’s sake, we could say as low as 7500, like “touching” 7500 before reversing, not closing below it. Then a strong move up to past 10k, on our way to confirmation of further upside above 10.5.
All in all the hearings today are a sign of capitulation FUD. We have many indicators showing oversold and “yet” with “potential” to go lower prior to reversal and until that 50 MA starts angling up again, the trend is still to the downside.
Could we test the lowest low? No. The low is set, we are now currently oversold. We are shaking out more weak hands.
I will say that while most were waiting for March to be an up month, and this is still possible, it seems that our real rally to all time highs (not this back and forth stuff) will begin later near May and through the Summer and Autumn into year end. Long term we will head up and this is a great buying opportunity. I suspect that the “sell in May and go away and play” mantra will be a big mistake this year.
Conclusion: Average in and buy more. Have testicles or ovaries of steel and HODL....oh and rock out to David Bowie below. Good times are coming. Banks wil buy into all these lower prices and so should you. I’ll be dollar cost averaging into all of this.