BTCUSD and market direction

2018年2月16日

We are now undoubtedly in the beginnings of an impulse wave. Every indicator (RSI, PPO, ADX and Stochastic RSI on 1D chart) is showing the same sign.

I have this labelled as wave 5 supercycle.

I use a "contrarian" approach to trading in that I have noticed time after time that when everyone is bullish, a correction is imminent, and when everyone is bearish, the next rally is about to begin. When everyone was bullish early-mid December, I was exiting trades into fiat, redistributing funds amongst my core holdings, and not entering into any new long positions.

Since early February I have bullish, gradually entering short terms trades, and generally spending a lot more time reading graphs and researching.

In my experience, the best thing to do during a correction is to:
1. Be prepared
2. Take a break from trading & the computer during corrections and/or have a vacation (large corrections e.g. July, September and December 2017 typically last 1-2 months. Buying back in earlier than a month is risky, so there's no better time to take on another hobby or occupy yourself with other things you enjoy. Patience = profit!

90% of traders lose money. The money they make are others losses. Not everyone can make money, and so it stands to reason that what the "herd" believes is happening or going to happen is almost invariably wrong.

The growth we've seen in bitcoin this past year is enormous, and this outlook may seem overly optimistic, but Wave 5 is characterized by your mums, dads, grandparents, your local shop owner - everyone - getting invested in a market. The larger the time frame the Wave 5 is on, the bigger the phenomena. This is a supercycle timeframe so this is THE wave 5. That, and bitcoins deflationary nature is a huge driving force behind positive price movement.

That being said, we have 2 key problems with bitcoin moving forward:
1. Transactions fees reached $55 USD in mid-december! As they're proportional to the number of transaction numbers, they are inevitably going to skyrocket and this really stops bitcoin from being used in the same manner as fiat currencies - i.e. buying coffee, filling the car with petrol, getting a bite to eat etc. This serves only to keep bitcoin as a fringe investment and will keep it from true mainstream adoption, which will certainly be achieved by other cryptocurrencies. It just isn't practical in any sense to use bitcoin for day-to-day, small transactions.
2. Bitcoin paved the way for this market to blossom, but its technology is dated, majority consensus is near impossible to achieve which stifles any innovation, and the potential and practical application of almost every other cryptocurrency in the top 15 is superior to bitcoin.

I think we will see the hype of bitcoin continue for some time yet, but we need to be continually wary of these aforementioned rate-limiting steps to bitcoins growth.

My prediction is an extended Wave 1 (reflecting ongoing hype) of the Wave 5 supercycle, followed by a 61.8% correction. After this, my predictions are educated guesses at best, but I've included them anyway.

I use fibonacci time and price retracements and extensions, time cycles and channels for this prediction.

I expect bitcoin to reach $50,000 USD by the end of May 2018. After this corrects to ~23k, it is anyone's guess as to where bitcoin's price will go.