Hello again! Here is another easy analysis about the long-term direction of BTC.
People tend to look to the past to learn for the future. That makes a lot of sense because patterns that repeatedly occured during the past seem to repeat again in the future. So lets do it. What is the same today, at least a little bit of the same, that happened in 2014.
First of all this is in my opinion the only logical comparisson you can do. Sure there are other similar patterns, but none of it had a ~65-70% correction on the daily chart.
So lets make a "right now analysis" on the logarithmic daily chart.
-The 200MA just shot over our heads with a good amount of momentum, this time the momentum is a bit more flat due to a longer and more steady run of BTC. -We have the same down trend-canal line pattern -We have a similar pattern of minor bull runs (red circles) -We have found a momentarly bottom at -65%correction -We have a very similar situation at the RSI -We DON'T have similarities to the Volume pattern. This time the Volume was freakishly high which also means a lot of resistances built up.
Overall fundamental analysis of the market: -After so many exponential waves of new money entering the market (also due to the monetary policy of some continents/countries-> for that look at my idea which is comparing QE of the ECB with the BTC Chart) we would need to see another exponential wave of new investors or money to enter the market. So what are factors for new money to enter the market, AFTER a major correction we are witnessing right now? The one and probably most important factor: A secured floor. This can only be established over several testings over a longer period of time after a crash(look at january 15 to August 15). So the next wave of new users have to be exponentionally as well. Ask yourself if BTC is ready for that.
The question is now: What would be an exit out of the 2014 pattern? If we have a strong run to 11k and than (more important) establish a very strong support again we are in the clear, but so far: BearBean is still here. But always remember: Possibility has no memory.
so far this downtrend is more similar to 2013 than 2014, where is the mt. gox level catalyst to warrant a crypto winter?
bean212
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@JoshuaVanier, I have to disagree with you. From the location kind of perspective you are right, but from the correction by itself it is a lot more similar than 2013, one major resistance we have today is the 200MA. If we now get a second wave like we got in 2013 we have at least to reach the target at 70k, I don't see any significant news or use of btc that would increase the value so drastically.
We don't need an explicit event like mt. gox. What makes a market drop is the fear that the price isn't the actual value and in the beginning of 2018 we experienced a series of news that is rather bearish on the chart, so uncertainty and fear were spreat enough
JoshuaVanier
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@bean212, Crypto-currency adoption by merchants is up, the fundamentals, speed, fees and scaling have all been addressed and improved, large exchanges are being bought up by institutions involved in financial sector, can't see why the crypto market cap would go to sub-100BN size without a catalyst.
bean212
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@JoshuaVanier, this might be, but with no significant news for real life use of bitcoin I don't see why it should rise ;) same argument, other side of the medal. And in the end, when a market is not going up it is inevitable going down. It might be a bit mixed here since it is a market for people who invest in an ideology and a market where anybody wants to make profit.
ArthurOliveira
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Nice, but the pump at the end of 2013 was twice more agressive
bean212
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@ArthurOliveira, That is true! The pump in 2013 was massive, right now we had a more steady run, which is rather is a bullish sign. But nevertheless I think we are still full bear is because the run was massive (I mean, 10k% is quite a bit) and also look at the correlations I set between the easy money entering the world (QE) and the current situation. The difference between central banks and stocks and central banks and crypto right now is: The banks will continue to pump money in the market for stocks so we don't enter a catastrophic world scenario. But they just don't care about cryptos. So where stocks right now are tumbling they will be resqued because the QE is slowly fading but rescueing has to continue. If btc struggles more because of the fading money there will be nobody to rescue it.