Im going to be looking at numerous indicators and models and when all stars are aligned only then I pull the trigger. This chart is just one of them
– Looking at history and drawing fib retracement from previous cycle high to cycle low it has so far given a good guide on areas in which top or bottom could occur as you can see on the chart.
– Channel I have drawn suggest that we are currently mid cycle and possibly developing bear market low with price action similar to 2017 (notice the circled area).
– My analysis therefore suggest top to be somewhere between 210k -275k which is close to Plan B’s stock to flow model suggesting 288k target which many traders respect and plan to exit at.
– Given the fact that fundamentals are really strong this cycle with unprecedented government spending, fiscal and , institutional adoption and buying, not to mention Bitcoin ETF’s being likely approved in upcoming weeks, I therefore wouldn’t be surprised to see price to extend above the target zone and end up in 300k range, potentially tap 400k level
– I don’t believe we are in super-cycle yet and I think institutions will rebalance their portfolios towards the end of the year and this could trigger selling domino effect and start of the bear phase. Many expect top to be in around December but given the current speed we could see the top as early as September/October. Or we could still have a scenario as in 2013.
– In regards to a buy zone please note that it was calculated based on 273k top and the idea that we are currently forming a bottom base based on fib extension 1.618 level from previous cycle. I’ll update this when the top is in place. Given the bitcoin adoption and demand it’s possible that it won’t fall as much as in the past, maybe this time it’ll fall “only” 50-60% and won’t dip bellow 100k with it acting as a strong psychological support. Best to start slowly scaling in after 50% drop for sure.
– As I said this chart is just a guide/model and I’ll be looking at many other fundamental and technical changes as well as on chain analysis: flow between exchanges and wallets, RHODL ratio, MVRV-Z score, potentially cross of 21EMA and 50MA on 3D chart, , certain contrarian indicators and sentiment, price action-(the best non lagging indicator) etc. Im not a big fan of and don’t rely on it but when everything is going to point to sell and is between 90-100 (3D or W) then it could strengthen my conviction.
Anything can happen though. We could have some type of black swan event as happened in the past. Good traders consider all the options, possibilities and are ready do adapt quickly when needed.