Damn that's pretty
After nine days of being trapped between the MA(25) and the top of the liquidity void... we have liftoff. This is the signal I've been waiting for, for a couple weeks now. It looks like it's finally time to say goodbye to the liquidity void and transition into an uptrend for the summer; a quite common happenstance.
Postmortem of a downtrend
It's always crazy to look at these things in retrospect because the vibe is completely different when you have all the information vs when you are trying to guess in the thick of the weeds. You really can't see the forest from the trees, as they say.
We had confirmation of the trend ending on April 12th when the price got above the dotted yellow descending wedge. However, looking at the chart we can see that the downtrend more accurately ended way back on February 28th during that first big dip that cut deep into the void. This is a thing that happens all the time: the downtrend ends way earlier than it looks like it will. Like when FTX collapsed and BTC was at $16k. It looked like we were screwed but that was the bottom bottom bottom. We didn't get confirmation that it was over until much later. I still remember people calling the entire year of 2023 a bear market which was quite comical to me personally, even at the time.
"They won't trap me."
Now it appears that we are in an uptrend, but again we have no confirmation to support this theory, and also by the time we get confirmation the move is usually about halfway over anyway, so it's easy to get cocky and make a mistake right before the wind shifts.
Clearly the next resistance that needs to be overcome is the MA(200), which is where we are right now. I don't think this should not be too difficult, but the MA(100) could be a little trickier because it's also sitting at a trendline right now. Essentially if we were to spike up to $91k today or tomorrow I'd probably have to throw in a quick short and put my day-trading hat back on. Or honestly I could just do nothing and enjoy the show because in my opinion the price has been suppressed long enough.
So many institutional hands have been buying nonstop during this lull in the price action. It's hard to believe we are bearing witness to so many paper hands selling to the enemy during their hour of victory, but here we are. MSTR owns over 3% of the spendable supply already, which is a feat I previously thought to be impossible, especially with the price this low. It honestly won't be that long before Big Tech is forced to jump onboard. I can't even imagine what will happen when Microsoft, Apple, Tesla, Meta, Nvidia, and Google are all buying at the same time. That's going to be way too much for this network to handle, especially when we consider that everyone else (like retail) will scramble to frontrun the action.
So why are so many people selling here?
Well the main thing is that fear is off the charts. The legacy economy has been thoroughly thrashed by all manner of bad omens. The tariff drama is really just the icing on the cake, but I'm not going to rehash all the things. It's honestly hard to find something that looks good in the economy, and Bitcoin is considered one of the riskiest risk-on assets so of course people are dumping it near all time highs. I remain convinced this is a massive gut-wrenching mistake. I have a lot of faith in the four year cycle, and it has thus far not been misplaced.
It all comes down to the liquidity event.
- The economy is buckling under the pressure.
- Trump is now trying to actively fire Powell.
- He wants the turn the money printer on.
- He wants a weak dollar and will get a weak dollar.
- This has been a known thing for months.
- The DXY is already back to 2022 lows.
When printer does go brrr all assets are going to moon. It will be quite the sight to behold. Until then we have to rely on crypto's ability to sustain itself during a drought of liquidity, which has obviously not been the most fun process but Bitcoin is still holding up quite well so that's a good sign for things to come.
Heatmap confirming the bias
Heatmap shows that there are a lot of shorts to squeeze right under $90k, so a pump into that $90k-$91k range again could be good for a quick short. Of course I'm so bullish right now it's a bit cringe to be thinking about shorting but it is what it is. It's hard to get into permabull mode when we've been disappointed this long. It's good to remember that there are a lot of shorts to squeeze at both $100k and $110k as well, and once we get into $120k territory I'm convinced the alts will rampage due to the suppression we've seen.
Dominance about to collapse.
The BTC.D chart also shows that dominance is completely overblown and potentially even threatening a [false] breakout to the upside. The longer we stepladder up like this the faster we are going to take the elevator down. This is a very consistent pattern in crypto. It looks strong and uncrackable and then it just craters in an instant; many such cases. Again, all in line with what I've been saying for many months now. With summer right around the corner it's more of a possibility than ever.
What we really need to do with this information is make a plan today for when we sell alts tomorrow. If dominance drops back down to 40%... well we need to seriously consider selling back into BTC or even fiat/HBD. Luckily history shows that Bitcoin does not start outperforming alts immediately once the bear market starts. We can get through a full 6 months of the 12 month bear market and alts still won't bleed against it. Remember that the "year of the maximalist" comes after the bear market year. That's when real pain for alts materializes, which luckily won't be until 2027, so we have a lot of time to ponder that part of the cycle and rotate around it.
Sell in May and go away?
Clearly Bitcoin is flirting with the idea of a summer rally, but selling in May is probably going to be a bit early, which is pretty standard. Summer rally tops are very hard to predict, and have happened in late May, mid June, July, and August. The only real constant is that the price always breaks down by September and late September is always a good time to buy. So we're going to have to play it by ear and try to figure out the breakdown of the trend based on TA as the information emerges.
Should be fun, and I did call it perfectly at $72k a year ago back in March 2024 (calling $58k crab WAY IN ADVANCE), so hopefully I'll be on point with this one. In fact I called it correctly on the current move as well by drawing the liquidity void long before we were ever even close to trading there. It seems that when price pumps quickly past an area we haven't traded at long, we are always destined to return. Easy enough.
My guess is going to be three months from the signal, and we just got the signal... meaning I'll be hoping for a peak in late July. It's a good enough target as any but needs a lot more data to back it up, and that data doesn't exist yet. Still need to know how May and June pan out. With a good timing we can flip short into September and buy it all back up on the cheap right before Q4.
Conclusion
Well it was boring for a while but it looks like we are back into the exciting times. Of course most plebs are still bored or even fearful right now because the price is still well below $100k. The real excitement begins when we are back at all time highs, but I'm not going to wait for the sheep to get bullish before I do. I've been at this long enough to know better.