diversionlulu

BTC analysis: Why 20k could be the bottom.

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
NFA
NOT FINANCIAL ADVICE.
This is just my personal point of view.

Hello everybody, in this analysis I've chosen to use the basics: Stoch RSI , MACD , RSI ... Along with other tools like: Log Fib, Bottom Ind, Etc.

First of all, I'd like to explain what kind of info can be retrieved from this chart. This chart notices about one clear as crystal thing: BTC price tends to go upwards with time, and that price increase tend to desaccelerate with time, also known as diminished returns. Next thing that should be explained is when BTC resumes an uptrend and when it does the opposite. That would be the identification of "cycles". According to popular media, BTC usually increases its price once it's getting closer to its next halvening date and to summarize the theory, BTC has four year cycles as a cyclical asset. My view is that BTC is effectively a cyclical asset where those cycles are getting extended / longer and that sooner or later, probably by 2024, that extension of cycles won't fit with halvening dates. So what is going on? It' easy to spot that BTC went superbullish from its inception in 2009 to 2011, then crash, then first halvening, then a first "middle cycle peak" by 2013 and after a massive crash a new upward trend pushed the price to a new ATH by early 2014 as a "final cycle peak". Then same history repeated, price went downwards til next halvening which happened in 2016 and a massive bullrun by 2017 which was stopped by some big correction in the summer of that year. Then you got bear period for a year, a great bullrun by early 2019 summer and then our "current cycle" started.

To avoid overextending this, what is my point? My point is that "mid cycles" doesnt exit. Every main cycle has a bullrun, a bear season, and a resume for another final bullrun; and those trends are getting shorter as you can see in the chart checking the measured time bars. What does this mean for the average guy? Well, it's going to be harder to spot if you are in a bullish or bearish trend , but the good news is that those trend are gonna last a little less than previous ones. Whom benefits this? That's easy. Investors and good traders. Average trader is the only one losing here as he wouldnt know what is going on.

In this main chart, you can see a log BTC /USD view using a tool which has recognized extremely well the bands which BTC has been using consistently as supports and resistances for its entire history. The black lines are the edges between what we should consider the top and bottom. Any candle going higher than the upper black line would be an extraordinary event pushed by extremely welcomed good news. On the other hand, any candle going lower than the lower black line would be an extraordinary event pushed by extremely spurned bad news. To date, upper black line has never been broken. On the other hand, lower black line has been pierced one time before when the uncertainty took the stock market back in March 2020 and after a massive black swan event and consequently crash, the fear spreaded to crypto market. To summarize this, only another black swan event should be able to drop the price below the black line, and in fact that event would happen, there are extra support zones which should stop the crash as it did back in March 2020.

As you can see in this zoomed chart, even if that black swan event would happen this week, price should keep above 12k. And if everything goes well, price should stop crashing around 20k.
https://s3.amazonaws.com/tradingview/sna...

Weekly Stoch RSI showing up longest downtrend that it has ever experienced. It's worthy of attention to realize about that every time BTC has touched these levels, Stoch RSI has bounced off providing at least a relief rally.
https://s3.amazonaws.com/tradingview/sna...

Weekly MACD showing up biggest crash ever for MACD levels, hitting lowest point ever for BTC . This metric shows up a possible reversal for the short-term as relief-rally and a feasible macro-trend change for mid-term as most optimistic scenario.
https://s3.amazonaws.com/tradingview/sna...

Weekly RSI showing up a multiyear weekly rsi support. Any support or resistance drawed line requires at least three pivot points , so there are big chances about RSI could bounce off from that point.
https://s3.amazonaws.com/tradingview/sna...

Daily RSI showing up a multimonthly daily rsi resistance. As you can see, this chart summarizes pretty well how every pump attempt from previous wave downwards has concluded as a weaker pump than previous one as that is being translated in that RSI trendline which so far has been unbreakeable. Irretrievably, this trendline will get pierced sooner or later as even if the same trading loop keeps happening, the RSI would be pushed every time closer to the bounce-off point edge.
https://s3.amazonaws.com/tradingview/sna...

Comment: NFA
Comment: Trend angle tool got misaligned. but angles are ok.