BTC : 2021's had a lot less momentum compared with prior peak
It will be a little bit different on today's market update, especially about bitcoin which in this specific post, we want to discuss further about the regression band on the bitcoin as the specific approach to identify the range on these overall bitcoin's bull market.
Just a note before we start that this regression band is only acting as a guidance for logarithmic support and resistance curve and it doesn't mean that the price can't breach below or above it.
Based on the structure given above, we see an interesting play on every cycle which consist of bullish and bearish pair on each cycle occurred.
First of all is that the upper regression band which is acting as a resistance. From current bitcoin's structure which have been forming an up trend formation wince the beginning of the time, we can see that the upper regression band has been always becoming a top of the inner cycle. However, there is slightly different between the peak on 2011, 2018, and 2021. If we see that the 2018 and 2013's peak reached the second regression line which is absolutely the maximum value of the ATH, 2021 was slightly below the regression line too. This simply means that the expected return on each cycle's peak is diminishing and this also means that the 2021's bull market didn't produce momentum as strong as what the 2013 and 2018 did.
Second thought is the support regression band which is the blue one. From current perspective, we see that the price is now trending right around the lower line of this regression band which has been considered as a bottom of each cycle. However if we looking at the past performances, this bottom have been breached several times during the local bottom test which there were 11% breach on 2015 and 24% breach on 2020. That's why it's still very possible that we will see another breach during the bottom test.
Looking at current structure, the worst case is that the market can still breach below current lower regression band in order to form a weekly candlestick wick toward the downside.
For now, it's still arguably that the bottom has been met but the data from this regression band alone is showing us that the price may shows us another bounce before a severe drop comes in. The fact that the momentum on the peak is a lot diminishing comparing with the other peak is very important and might be a concern for us.
Just a note before we start that this regression band is only acting as a guidance for logarithmic support and resistance curve and it doesn't mean that the price can't breach below or above it.
Based on the structure given above, we see an interesting play on every cycle which consist of bullish and bearish pair on each cycle occurred.
First of all is that the upper regression band which is acting as a resistance. From current bitcoin's structure which have been forming an up trend formation wince the beginning of the time, we can see that the upper regression band has been always becoming a top of the inner cycle. However, there is slightly different between the peak on 2011, 2018, and 2021. If we see that the 2018 and 2013's peak reached the second regression line which is absolutely the maximum value of the ATH, 2021 was slightly below the regression line too. This simply means that the expected return on each cycle's peak is diminishing and this also means that the 2021's bull market didn't produce momentum as strong as what the 2013 and 2018 did.
Second thought is the support regression band which is the blue one. From current perspective, we see that the price is now trending right around the lower line of this regression band which has been considered as a bottom of each cycle. However if we looking at the past performances, this bottom have been breached several times during the local bottom test which there were 11% breach on 2015 and 24% breach on 2020. That's why it's still very possible that we will see another breach during the bottom test.
Looking at current structure, the worst case is that the market can still breach below current lower regression band in order to form a weekly candlestick wick toward the downside.
For now, it's still arguably that the bottom has been met but the data from this regression band alone is showing us that the price may shows us another bounce before a severe drop comes in. The fact that the momentum on the peak is a lot diminishing comparing with the other peak is very important and might be a concern for us.