So, we can see that BTC has been following the projected pullback, but will it fall even deeper? To answer that question, we can look at the past performance here on the weekly chart. Interestingly, each time BTC has tested the 50 week moving average (in orange) from above, it eventually failed and dropped below it, initiating a continuation of the bear market. You can see that first happened in 2011. BTC tested the 50 week, then dropped below it, falling an additional 61%. Then, BTC recovered into the next bull market, and didn't test the 50 week from above until 2014. At that point, it failed to hold again, and BTC continued with an additional 52% decline in the bear market. Then, the next bull market ensued, and BTC didn't test the 50 week until early 2018. As you can see, the 50 week moving average failed to hold again, and BTC fell an additional 51% in a bear market continuation. This phenomenon also presented itself in late 2019. BTC tested the 50 week from above, failed to hold, and then dropped 46%. So, there is definitely a clear pattern of failures when it comes to 50 week MA tests. From an analytical perspective, it's wise to expect similar outcomes until that trend is broken.
Looking at the RSI (lower graph) you can see that there is a red horizontal line drawn across, at around the 54 level. What is very clear, is that when BTC is above that level, it's in a bull market. Similarly, when BTC falls below that level, it is in a bear market. For clarification, I'm not talking about a little peek above or below that level. I'm referring to sustained action above or below it. When we tie that into the analysis of BTCs performance at the 50 week, we can see that each and every time BTC failed at the 50, it also dropped BELOW that 54 level on the weekly RSI, indicating a continuation of bear market activity.
At the moment, BTC is just now testing the 50 week moving average, after a strong bull market. Additionally, the weekly RSI has fallen below the 54 level, indicating that a failure is likely, and a bear market continuation should be expected. So, if BTC falls an additional 45% or so (which would be in line with previous 50 week MA performance) we would see it reach the 200 week moving average. That is where BTC bottomed on the last two bear markets. So, there is a high probability that BTC could bottom there again, if we see a strong bear market continuation here. That would be somewhere around the 15,000 level, which I have been talking about for quite some time.
On another note, you can see my regression arc in blue, as well as the EW count that I have for BTC's entire existence. I believe that we finished the first super cycle in January of 2018. Then, we went into a clear corrective flat ABC, and now BTC has likely completed the first wave of the next supercycle. We are likely now in the wave 2 correction, which should take us lower than the current levels. Once this bear market is complete, I do believe that BTC will go on to make new all time highs, eventually reaching the several hundred thousand dollar mark, but the road is long to get there.
For now, BTC is holding support on the 50 week, but it should be closely monitored for failure. If we were to look at the daily chart, we would see that BTC is currently trading BELOW the 50 and 200 day moving averages. So, given the technical picture of past performance at the 50 week MA, it's likely that BTC will fail to recover above those daily moving averages, and it should continue to fall below the 50 week. That could take several weeks to materialize though, as has been the case in the past. Good luck trading everyone.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
Looking at the RSI (lower graph) you can see that there is a red horizontal line drawn across, at around the 54 level. What is very clear, is that when BTC is above that level, it's in a bull market. Similarly, when BTC falls below that level, it is in a bear market. For clarification, I'm not talking about a little peek above or below that level. I'm referring to sustained action above or below it. When we tie that into the analysis of BTCs performance at the 50 week, we can see that each and every time BTC failed at the 50, it also dropped BELOW that 54 level on the weekly RSI, indicating a continuation of bear market activity.
At the moment, BTC is just now testing the 50 week moving average, after a strong bull market. Additionally, the weekly RSI has fallen below the 54 level, indicating that a failure is likely, and a bear market continuation should be expected. So, if BTC falls an additional 45% or so (which would be in line with previous 50 week MA performance) we would see it reach the 200 week moving average. That is where BTC bottomed on the last two bear markets. So, there is a high probability that BTC could bottom there again, if we see a strong bear market continuation here. That would be somewhere around the 15,000 level, which I have been talking about for quite some time.
On another note, you can see my regression arc in blue, as well as the EW count that I have for BTC's entire existence. I believe that we finished the first super cycle in January of 2018. Then, we went into a clear corrective flat ABC, and now BTC has likely completed the first wave of the next supercycle. We are likely now in the wave 2 correction, which should take us lower than the current levels. Once this bear market is complete, I do believe that BTC will go on to make new all time highs, eventually reaching the several hundred thousand dollar mark, but the road is long to get there.
For now, BTC is holding support on the 50 week, but it should be closely monitored for failure. If we were to look at the daily chart, we would see that BTC is currently trading BELOW the 50 and 200 day moving averages. So, given the technical picture of past performance at the 50 week MA, it's likely that BTC will fail to recover above those daily moving averages, and it should continue to fall below the 50 week. That could take several weeks to materialize though, as has been the case in the past. Good luck trading everyone.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-