Good day Hiveians!
Join me in analyzing the crypto markets!
To answer the question of my last post:
no, we won't be having a 100K Bitcoin summer. That so far seems quite clear. For that to have happened we would have needed to stay in this channel leading right up to it. This is a bummer as I had really hoped to see a three wave bull market. While I am not dismissing this scenario entirely, we have to look at other scenarios as a good analyst always adapts to the market rather than sticking to old ideas ;)
In the previous post I also presented this chart in which I argued for a potential downturn to ~30k and a bullish reversal (seen here in the purple path). The blue path seems to be invalidated currently which still leaves room for the green path. I am going to focus on these two scenarios.
The 3rd wave scenario
I have argued for the "third wave" for quite some time now. But I have to admit that it seems increasingly less likely with Bitcoin dropping under 36k. In the chart above you can see that price could drop to ~30k (which it is currently doing) and then reverse. The idea behind this is that the market frist needs a big sell off for the bulls to take over again. There is a strong support here from a long established trend line which will probably hold for the time being. If so, perhaps we could see the last phase of the bull market which would take us to potentially 100k. But this couldn't happen much earlier than Winter.
But a bullish wave like this normally needs a catalyst such as the "Musk wave" (when Elon Musk said he would buy bitcoin) or paypal accepting cryptos etc. Will this happen? Not sure; but without something like this I doubt the third wave will happen.
The half way through the bear market scenario
The good news is that if the 3rd wave should not transpire, we are basically half way through the bear market. In this case the market peaked in November last year at ~69k which would make this a very underwhelming bull cycle with "only" about a 2000% increase from the lows of 3k. But obviously Bitcoin can't have 100xs in the future. Bitcoin simply just can't go to 1 million or 10 million in a year or so. At least not at current adoption. The market cap would be so huge that basically everyone you know would have to be involved in cryptos...
An insight that came to me in recent days and I think the most important chart of today is very simple. If we draw a trend line on the monthly chart for the bottoms in the bull market we can very accurately predict the bottom of the bear market!
Oops! So this means we will most definitely have a futher correction. The question is just, will we have the 3rd wave before that or just simply head straight to 22k?
To me this chart is really amazing. One can with high confidence say that Bitcoin will revisit ~22k in the near future. It is basically guaranteed.
Everybody should have some "dry powder" to buy some cheap cryptos in the coming months. But the silver lining is that we are probably already half way through the bear market and that Bitcoin is also basically guaranteed to go to 100k and beyond in the coming years.
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!
Check out the Love The Clouds Community if you share the love for clouds!