BarclayJames

BTCUSD exponential channel

KRAKEN:XBTUSD   XBT / USD
Bitcoin has re-entered it's exponential growth channel. On charts with a logarithmic y-axis, exponential curves are transformed into straight lines, hence I show a linear channel.

I interpret this channel as Bitcoin's stable / organic growth path. Everything above the channel is a speculative bubble, not caused by fundamentals, but by speculation alone. Everything underneath the channel is crypto doom - of course we can go below, but that period I interpret as recession. Hence stable growth separates Boom & Bust.

Here is the full channel dating back to 2011:


Compare out current position to 2015 when we re-entered the channel. I see a "sideways" approach to the channel bottom taking us into Q4 / 2019. The green shaded zone represents the likely sideways channel. This is a trading zone of 4900 to 7700. It is not necessary that we test either extreme in my opinion. We lack volatility that much is clear.

The middle of the channel is 6200 this seems like a good average level for the period. I expect oscillation about this point.

In addition, check 2015 again. It is also not necessary that we touch the channel bottom, we can do that later on as we climb the channel.


Comment: A naive Bitcoin model based on the seasons
https://medium.com/@sunnyday.james/bitco...
Comment: My theory of Bitcoin corrections https://medium.com/@sunnyday.james/the-c...
Comment:
Comment: I remember when I did this chart, bears were screaming 3k and 4k. well although not impossible I think that would not lead to another all time high again.
fractally it appears we have completed the correction, now it is a battle between bear and bull forces for final control of the market and overall future of crypto. do we survive or not (bull or bear)
Comment: here is a close-up
Comment: Bouncing on the channel bottom, will it be enough?
Comment: looking like resistance now
Hey James, re the "medium post"...very plausible...but really hope that doesn't happen...as that'll mean BTC will be in this low range for quite awhile and ATH won't be reached until Q1/Q2 2019...

But at the moment I think the market probably won't start a new bull trend until the ETF is approved and/or any breakthrough in tech i.e. increasing scalability to the thousands or even 1 million.
Reply
@SaimanLi, Yes that's right. Actually I hope it is like this. Also I think we can still have a small run, particularly if the parabolic return to 20k is after the mid-point of the cup.

About scalability, the Ethereum guys say with Plasma they could achieve 1 million tx per sec. Well Joseph Poon who designed the Lightning network is collaborating with Vitalik on that so interesting combination... also theoretically Lightning can already handle such loads, just that the network needs physical development still. I will try and find out but I believe it is growing exponentially. Would be good to do some charts there with number of nodes etc ;)

ETFs... I don't know much about tbh. I know people think futures have a negative effect on the market but that's because they are generally launched at the top of a market. ETFs well that's something else to check, it would be worth looking at gold there maybe
Reply
SaimanLi BarclayJames
@BarclayJames, hmmm I briefly read something about Vitalik and Joseph Poon...but didn't know they were collaborating!

With ETFs it'll allow more players to enter the market. So basically investors invest in say a hedge fund company and they in turn buy Bitcoins...this basically means more investment. Theres a few "experts" saying if thats approved BTC can go to $50k by year end...
+1 Reply
Agreed! However, the best-fit of the growth channel is not a strait line in the log chart, but a square-root function. Your lower channel yields around 4500 as the absolute bottom, I think it will go lower than that, around 3k. But apart from that, nice chart ! :)
Reply
BarclayJames FlaviusTodorius67
@FlaviusTodorius67, It can be a square root gives a good fit I don't know. I have also seen log models but I disagree with them as they assume too much. Logistic growth moves at some point from exponential to logarithmic, but we have no way of knowing if we are there yet. If you plot 2^(a*x) - b, with a=4.24e-3 and b=0.94 you can also get a really nice exponential fit (see: https://drive.google.com/file/d/1S3m0NPNkQGQMRcj7JVld5hP4JANmACw7/view?usp=sharing).

However the real fit is probably a / (1 - b * exp(c * (x - x0))), it's a logistic function (s-curve). It consists of an exponential phase followed by a logarithmic phase/. I wasn't able to perform a regression on the data - was really annoyed. Interesting is when you log the logistic curve, the s-shape turns into the Bitcoin trend imho. I will try post that later cos I can't find a chart on google
Reply
BarclayJames FlaviusTodorius67
@FlaviusTodorius67, linear left, log right. however the funciton I told you is wrong - should be a / (1 + b * exp(-c * (x - x0)))

https://drive.google.com/file/d/1INkDasPyo7tBVjf68G6rZeZha1njIJdH/view?usp=sharing
Reply
@BarclayJames, Hm ok, thanks for the info, good to know. Yes, the fit looks quite promising. Well, of course I hope that your fit is the right one, since this would mean MOON sooner and higher than the conservative sqrt fit, hehe! The log S function would yield pretty insane prices in a few years. I have nothing against it :)
Reply
Home Stock Screener Forex Screener Crypto Screener Economic Calendar How It Works Chart Features Pricing House Rules Moderators Website & Broker Solutions Widgets Charting Solutions Get Help Feature Request Blog & News FAQ Wiki Twitter
Profile Profile Settings Account and Billing Get Help Ideas Published Followers Following Private Messages Chat Sign Out