TradingShot

BITCOIN The MFI and 2W MA100 Golden Bottom Indicators

INDEX:BTCUSD   Bitcoin / U.S. Dollar
My latest Cycle analysis on Bitcoin ( BTCUSD ) is again geared towards estimating the bottom of the current (smoothest of all time as I've called) Bear Cycle that we are in. This time I am shifting to the 2W time-frame as a unique indicator combo is displayed.


** The 2W MA50 and MA100 **
The red area indicates the time from the start of the Bear Cycle to when a 2W candle closes below the 2W MA50 (blue trend-line) for the first time. As the chart shows, this has so far been fairly consistent throughout the Bear Cycles as in 2014 that lasted 378 days (27 2W candles), in 2018 it lasted 336 days (24 2W candles), while on the current Bear Cycle it took again 378 days (27 2w candles) as in 2014.

Then I measure the time it took from the 2W MA50 closing to the time the price hit the 2W MA100 (green trend-line). In 2014 that was 28 days (2 2W candles), while in 2018 it was 77 days (6 2W candles). That sums the time from the start of the Bear Cycle to the 2W MA100 touch at 406 days and 413 days respectively.


** The MFI indicator **
Perhaps the most important addition to the mix is the Money Flow Indicator ( MFI ), which gives a buy signal when it hits the 25.50 level. It has done so on the January 05 2015 and the January 21 2019 candles. Both of those hits, marked a Bear Cycle bottom as the price was at the same time on the 2W MA100. The June 18 2018 MFI 25.50 approach doesn't fall into that category as, not only the indicator wasn't on the 25.50 level but the price hasn't closed below the 2W MA50.


** Conclusion **
This simple analysis shows that the market bottoms when the 2W MFI hits the 25.50 level while the price trades on the 2W MA100. The MFI is currently around 33. 40 , while the 2W MA100 at 21825. Note that the only time Bitcoin closed below the 2W MA100 was in March 2020 during the COVID global crash and still that was just marginally. As far as timing is concerned, if the current Bear Cycle follows the pattern of 2014, then it should bottom by the May 23 2022 2W candle and if it follows the pattern of 2018 it should bottom by the June 20 2022 2W candle.


But what do you think? Do you estimate that a bottom is not far away and if so, will it be on the 2W MA100 or lower? Feel free to share your work and let me know in the comments section below!



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