It can be a challenge comparing the timeframes of two bubbles in TA, when one runs over the course of 10 years vs 2 years.
Yet i believe a striking correlation playing out here between two completely different markets in it's own timeframe.
As always, both bubbles is naturally fuelled by the same greed and stupidity that is coded into our human DNA .
We don’t mean to get ourself in trouble by creating bubbles, but we just can't help it.
It’s what makes us human. It’s the same reason we can be so certain that the next phase must begin.
What im saying is nothing new under the sun. You can go back in history and study these cycles playing out over and over. It always comes down to two human components.
Immense greed and extreme fear, resolving in its own way. Like Ying and Yang, a balance is always kept. It might temporary bend further to the up or downside but the ledger is always kept in check and unbalanced profits will be resolved with unbalanced losses.
There’s nothing inherently evil about a bull market coming to an end, however history tells us pain and fear is two cousins that few remember at this point in the market cycle.
Drawing correlation to the Bitcoin bubble in 2017, every retail investor was a genius and money was to be made whatever u did, as long as u bought - Did u get that last part?
As long as u bought. Because bubble tops paints its own beautiful story, which we can use to our advantage if we pay attention. The signs are always there, and im simply hinting the strong probability of human faults once again painted on the charts.
For the retail investor which has been genius for years in Nasdaq, DJI or whatever he bought, the next phase won’t be as quite as easy.Conditioned by 10 years of buying the dip, the retail investor will slowly but surely bleed out in the bear market. As they continuously buy the dip, but never secure profits on the bounces, slowly but surely, most will lose their profits from the bull years as the balance is restored to the ledger. That’s what makes it the bear market.
Let’s see just how many skeletons we have in the closet for this bear cycle. I bet there’s some intersting stuff from 2008 that was swept under the carpet which will come out and play.
It'll probably get very ugly.
Bull markets often extend way beyond expectations. The following cycle tend to do the same.
It is in my view, that behavior often will take the same shape on a short term basis. I could just as easily isolate any point in time of the Dow or any index and find a totally comparable instance going on in another point of time for another bubble or even wonderous rise.
However, because the DOW is multiplicative to itself and aggregates earnings off of the growth of assets, it's extraordinarily unlikely to take on the exact long-term form of BTC on that fundamental basis.
Simply put, investment in Bitcoin is a zero-sum gain. The appreciation is based on willingness with no background to anchor the value other than belief. At the very, very least, the index representing any companies will continue to accumulate based on growth of assets, earning performance and future endeavors discounted to the time present...all depending on the implied required rate of return of the market investors. As textbook as that may sound, it is important that we go back to what strings pull on two different puppets running two different kinds of shows. I commend you for spotting this out, but I would have to say that a fundamentals type of analysis still matters in the grand scheme of what a technician is doing. Believe me, don't believe me..does not matter to me. This is something I teach and practice.
However, because the DOW is multiplicative to itself and aggregates earnings off of the growth of assets, it's extraordinarily unlikely to take on the exact long-term form of BTC on that fundamental basis.
Simply put, investment in Bitcoin is a zero-sum gain. The appreciation is based on willingness with no background to anchor the value other than belief. At the very, very least, the index representing any companies will continue to accumulate based on growth of assets, earning performance and future endeavors discounted to the time present...all depending on the implied required rate of return of the market investors. As textbook as that may sound, it is important that we go back to what strings pull on two different puppets running two different kinds of shows. I commend you for spotting this out, but I would have to say that a fundamentals type of analysis still matters in the grand scheme of what a technician is doing. Believe me, don't believe me..does not matter to me. This is something I teach and practice.