Long term Indicators to look for in a Bitcoin bull cycle
As a follow on to the last analysis we can see that BTC is now above the GC (Gaussian Channel).
On the LMACD we can see where the grey arrow is that it is about to bounce or crossover to bearish.
We know from our previous posts that when the EMA 10 (in blue) is above the MA 21 (in orange) and BTC doesn't trade under the MA 21 on weekly chart, BTC is in a bull cycle and prices continue to rise until the next all time high. BTC also needs to stay above the GC.
Back in April's analysis, we asked the question..... Will BTC move above the GC and if so, when will it retrace back to the MA 21 to retest this important weekly chart indicator?
We can clearly see the above is happening right now on this chart.
I don't expect BTC to break the above bull cycle parameters seeing as we have confirmed previously that the start of the 5 wave bull cycle has occurred already. What also confirms the bull cycle is the 'ribbon' type look of all the moving averages. As you can see the 10 is above the 21, 21 above the 34, 34 above the 50, 50 above the 100, 100 above the 200. This 'ribbon' feel or look should continue throughout the 5 wave bull cycle as you can see on the previous bull cycle to 20k.
This doesn't mean however that the CME gap at around 9.7k won't be filled. BTC could easily spike down to the EMA 34 (in pink) which is currently at 9564.19 and close the gap then close the actual weekly candle above the MA 21 (in orange) and the GC at around 10.1k.
Infact, I expected a drop of around 9% on BTC from opening price of 11661.35 on Sep 1 to the closing price on Sep 30. This means if I am right, the price should open on Oct 1 at around 10.6k. This would also confirm the 2nd leg of the cycle has occurred and wave 3 will begin which usually lasts for 5 to 6 months and is where some high percentage returns are made. If BTC closes above 11661.35 on Sep 30 then next month will be a negative month for sure with a drop of the 9% I mentioned I expected for the 2nd leg of the cycle.
On the monthly log chart below we can see that BTC is holding above the EMA 10 (in blue) as per our theory: If you look back before last halving you can see that once the BTC monthly candle went above EMA 10 it held this till the next bear cycle. The EMA 10 sits at 9670.60 so this also gives BTC room to drop to the CME gap this month.
On the daily log chart below we can see the LMACD is looking like it is about to crossover or continue to drop with a bounce downwards.
The moving averages are all looking bearish unless BTC can move above the MA 21 (in orange) at the 10850 area. This same area is where the EMA 34 (in pink) and the EMA 50 (in yellow) also sit currently and just above that the mid point of the GC, so some resistance to break through. The good point here is that the EMA 10 (in blue) did not cross under the EMA 100 (in purple) which if you look back in previous bull cycles this was a great point to buy in at.
Will the gap be closed or will the shorts in the market act as fuel needed to blast through 13k?
Will this month be another positive month or will it be negative? This will show us what happens next month as per above.
Happy trading legends!
HTBB
Donations via TradingView coins will enable me to post more of my analysis with more information. Thanks in advance if you are a legend who donates.
On the LMACD we can see where the grey arrow is that it is about to bounce or crossover to bearish.
We know from our previous posts that when the EMA 10 (in blue) is above the MA 21 (in orange) and BTC doesn't trade under the MA 21 on weekly chart, BTC is in a bull cycle and prices continue to rise until the next all time high. BTC also needs to stay above the GC.
Back in April's analysis, we asked the question..... Will BTC move above the GC and if so, when will it retrace back to the MA 21 to retest this important weekly chart indicator?
We can clearly see the above is happening right now on this chart.
I don't expect BTC to break the above bull cycle parameters seeing as we have confirmed previously that the start of the 5 wave bull cycle has occurred already. What also confirms the bull cycle is the 'ribbon' type look of all the moving averages. As you can see the 10 is above the 21, 21 above the 34, 34 above the 50, 50 above the 100, 100 above the 200. This 'ribbon' feel or look should continue throughout the 5 wave bull cycle as you can see on the previous bull cycle to 20k.
This doesn't mean however that the CME gap at around 9.7k won't be filled. BTC could easily spike down to the EMA 34 (in pink) which is currently at 9564.19 and close the gap then close the actual weekly candle above the MA 21 (in orange) and the GC at around 10.1k.
Infact, I expected a drop of around 9% on BTC from opening price of 11661.35 on Sep 1 to the closing price on Sep 30. This means if I am right, the price should open on Oct 1 at around 10.6k. This would also confirm the 2nd leg of the cycle has occurred and wave 3 will begin which usually lasts for 5 to 6 months and is where some high percentage returns are made. If BTC closes above 11661.35 on Sep 30 then next month will be a negative month for sure with a drop of the 9% I mentioned I expected for the 2nd leg of the cycle.
On the monthly log chart below we can see that BTC is holding above the EMA 10 (in blue) as per our theory: If you look back before last halving you can see that once the BTC monthly candle went above EMA 10 it held this till the next bear cycle. The EMA 10 sits at 9670.60 so this also gives BTC room to drop to the CME gap this month.
On the daily log chart below we can see the LMACD is looking like it is about to crossover or continue to drop with a bounce downwards.
The moving averages are all looking bearish unless BTC can move above the MA 21 (in orange) at the 10850 area. This same area is where the EMA 34 (in pink) and the EMA 50 (in yellow) also sit currently and just above that the mid point of the GC, so some resistance to break through. The good point here is that the EMA 10 (in blue) did not cross under the EMA 100 (in purple) which if you look back in previous bull cycles this was a great point to buy in at.
Will the gap be closed or will the shorts in the market act as fuel needed to blast through 13k?
Will this month be another positive month or will it be negative? This will show us what happens next month as per above.
Happy trading legends!
HTBB
Donations via TradingView coins will enable me to post more of my analysis with more information. Thanks in advance if you are a legend who donates.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.