Remove the Noise!! This is pure mathematics, statistics and probability. The 'Hidden' Death Cross & 'True' Golden Cross are the cross of the weekly 50 SMA & 50 EMA, which with 8/8 historical cross cycles completed, consistently (100% of cross cycles) result in a significant market contraction or expansion.
Note: I am bullish on BTC, but these macro economic cycles must complete and ignoring statistical probability because of over bullish dreams, sentiment or "conviction" is likely the no. 1 fallacy of most traders in all markets.
In the following historical analysis, I identify each cross,
For contractions, I use the price at the date of the Hidden Death Cross, to the lowest price to determine the price drop percentage.
- 100% Probability of Market Contraction - Average contraction: 64%
Standard Deviation (Confidence); - SD 1 (90%): Max 68% / Min 60% Correction - SD 2 (95%) Max 69% / Min 59% Correction - SD 3 (99%): Max 71% / Min 57% Correction
Market expansions are identified from the price at the date of the True Golden Cross, to the highest price to determine the price increase percentage.
- 100% Probability of Market Expansion Expansion values too variable for significant deviation estimation
Conclusion:
I am a TA traditionalist, I believe that the price reflects all known / unknown information and that price action reflects human behaviour in reaction to the changing nature of the information to establish the best possible price at that moment in time.
Based upon the mathematical analysis of the price action, for example tracking moving averages, we can identify the trends in human behaviour and apply statistical probability to these trends.
As can be observed above, the statistical probability of this trend is considerably strong, with a 99% confidence of a drop in the range of 57% to 71% after the Hidden Death Cross that happened the 30th of August 2021.
I guess a once in a lifetime opportunity to reload :)
Yemala
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@CryptoBitcoinFunk, could be, these cycles repeat, identifying them is the key to reloading at the right time 😄
ROI_Crypto
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@Yemala this scenario will have to coincide with some traditional market tanking....
This is going to be an interesting week.
Big like on this cross, looking for some HMA correlation. i'll DM you
Yemala
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@ROI_Crypto, You're totally right! BTC Market will tank with Stock Market - This will happen by the end of the year / start of next year! Correctly applied TA, based in statistical probability of empirical data gives really great insights into when and how severe it will be :)
- Interested to hear about the HMA
SpaceCatZ
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Nobody even mentioned about bitcoins golden cross but dead cross seems to be new scary tool for entry level TA's. Perhaps focus on improving your skills first!
Yemala
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@SpaceCatZ, This comment is clear trolling breaks 2 House Rules:
"5. Be nice...
Can't believe we have to spell this out, but yes, please treat others how you'd like to be treated yourself. Be respectful, kind, tolerant and constructive, even when you disagree. There's no room for negativity, swearing, trolling, and conflict here: it's a waste of time and the hallmark of an idiot."
"6. ...Don't be an asshole.
We have a zero tolerance policy for contentious political discourse, defamatory, threatening or discriminatory remarks, hate speech or personal attacks. Our users are our top priority and we won't let anyone bully or belittle them."
I will not flag this for moderation, I would prefer to give you and all readers constructive feedback;
- It is up to you if you wish to reflect upon this constructively or take this negatively, however since we do not know each other and I hold no grudges with you, I would encourage you to engage in this constructive discourse.
- Regardless of your use of this feedback, your comment was clearly trolling & broke 2 house rules - this needs to be addressed, I prefer not to flag
1. This post does not reflect any personal or subjective opinion or technical analysis from me - in fact this post purely identifies a reoccurring trend on Weekly SMA & EMA & calculates the statistical probability of such events happening & the average ranges with standard deviations of the consequences of these events in price action
2. I would be happy to mention the BTC Golden Cross, which I assume you refer to on the Daily Timeframe (since there are no MA or EMA Golden Crosses on the Weekly).
- The Daily 50/200 SMA Cross know as a Golden Cross or Death Cross, can have the same application of mathematical & statistical probability applied, for which when we do apply it we find the following;
a. 4/7 completed Daily SMA Golden Cross cycles have been successful with a market expansion
- Thats a 57% Success Rate, compared to a Weekly Hidden Death Cross Success Rate of 100%
- The Standard deviation 2 (99% Confidence) of expansion post a successful golden cross (57% chance of happening) is a range of 7'000% - 18'000%
b. 3/7 completed Daily SMA Golden Cross cycles have been unsuccessful with a market contraction
- Thats a 43% failure rate, compared to a Weekly Hidden Death Cross Failure Rate of 0%
- The Standard deviation 2 (99% Confidence) of a contraction post a unsuccessful golden cross (43% chance of happening) is a range of -45% to -75%
- Which bet would you take?
3. Death Cross or Golden Cross are not a tool - they are empirical data, objective & unchanging regardless of observer - based upon this empirical historical data, we can apply statistical probability and weighting to identify probability of an event happening again & the range that it could happen with varying levels of confidence - see Standard Deviation
Perhaps you should focus on improving your skills?
Happy to connect & discuss should you wish
- yemala
SoupKitchenManagement
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@Yemala, Now this, this is how you reply to people. others should take note.