BTCUSD February 2022 Technical Analysis
Looking at the 2-day chart of Bitcoin moving into the month of February, we can see major similarities between Summer 2021 bear market / correction & this most recent Crypto Winter.
Both market corrections sold off about ~50% of their market capitalization, followed by a little over a month of accumulation / consolidation around their respective higher low levels.
In the first bear market, Bitcoin caught the uptrend as well as the level of support at $30,838. From here, we saw another cycle top which lead into the next bear market.
In the second bear market, Bitcoin lost the uptrend but wicked the $33,099 level of support, closing out the CME Futures Gap, multiple LG levels, and ended up posting a higher low to confirm / continue the bullish momentum.
We aren’t necessarily bullish after flipping the market structure on this $33,099 touch and still need to go through this month period of consolidation before the next leg up. Throughout February, we should continue to see bulls be shaken out, and they will flip the MS again back to the upside once shaken.
At the moment, Bitcoin seems to have the momentum to wick the $39,696 level, and from there we will re-evaluate our position and determine whether the price is flipping bullish or creating this lower high to another leg down. Chances are, they aren’t going to make this easy for entries, you really just need to commit to a price and stick with it.
To hit $33,099 on entry you needed to have that level set with the orders placed as that move happened very fast. I don’t believe market makers will allow retail another entry at $33,099 (but what do I know, i’m not a maker) and the best we could see is a retest of the $34,484 level on the way down as we paint the new monthly candle.
I’ve taken the time to backtest my strategies and try them historically. Looking back in time starting at the 2013 cycle, I’ve marked 3 simple candles: Start of the uptrend ($13.50), Cycle Top ($185), and the Swing Level ($47.24).
Now taking a look at the end of 2013 cycle, i’ve marked 4 candles: End of 2013 Cycle Top ($1,119), the Swing Level ($325), Start of the Uptrend ($123), and the 2012-2013 Cycle Top level ($185).
The 2017 bull run has a few more lines, disregard them for now except for the start fo the uptrend, swing level, and the 2017 bull run all time high price.
Now with all of these previous cycles in mind, let’s take a look at a few glaring similarities. It’s obvious that Bitcoin moves in cycles, however, understanding the lengths and depths of these cycles isn’t so obvious.
(Side note: You can find the Bitcoin Cycle Top Indicator on my profile page, ‘add to favorites / like’ the indicator to add it to your chart)
After Bitcoin has its blow-off top, it is soon followed by a heavy market correction. Something to notice is that Bitcoin has always pulled back to the Swing level, not the start of the uptrend. Bitcoin has never pulled back and retraced 100% of its gains to the start of the uptrend, and instances where the Swing Level gets front ran, like in 2013, it is followed by an extended period of accumulation before the next leg up. This exact pattern occured in 2017, where Bitcoin front-ran the Swing Level by only a few $, but because of that it had to endure a 4-year bear market.
Based on historical data, if we front-run the Swing Level after the Cycle Top, we should expect a 3-4 year bear market, followed by another blow-off top.
Now let’s move onto the current cycle, 2021. Just like every cycle before, i’ve marked the start of the uptrend, the swing level, and the 2021 Cycle Top. In Summer 2021, we’ve already backtested the Swing Level, therefore it was a valid move upwards going into the end of the year.
The start of the uptrend is placed at $18,967 (and I was very liberal with that placement, it really starts at $10,524 with a LG at $12,775) and just like every cycle previous, this one doesn’t look like it’s going to come back down and retest there (knock on wood).
Now, taking a look at the CME Futures (BTC1!) on the 2-day time frame, we can see the liquidity gap that has filled at $32,930. This backtested to a Tee, not a dollar over or under, and is now primed to move up. I strongly believe that the market makers will not let retail get an institutional level entry, however, that is simply not up to me.
Bitcoin has historically backtested all of the levels it needs to in order to move up properly without exhaustion, closed the liquidity gap on the CME Futures, and is increasingly becoming more scarce on exchanges day by day.
As always please do your own research, this does not constitute as financial advice as this information is for educational purposes only.
Both market corrections sold off about ~50% of their market capitalization, followed by a little over a month of accumulation / consolidation around their respective higher low levels.
In the first bear market, Bitcoin caught the uptrend as well as the level of support at $30,838. From here, we saw another cycle top which lead into the next bear market.
In the second bear market, Bitcoin lost the uptrend but wicked the $33,099 level of support, closing out the CME Futures Gap, multiple LG levels, and ended up posting a higher low to confirm / continue the bullish momentum.
We aren’t necessarily bullish after flipping the market structure on this $33,099 touch and still need to go through this month period of consolidation before the next leg up. Throughout February, we should continue to see bulls be shaken out, and they will flip the MS again back to the upside once shaken.
At the moment, Bitcoin seems to have the momentum to wick the $39,696 level, and from there we will re-evaluate our position and determine whether the price is flipping bullish or creating this lower high to another leg down. Chances are, they aren’t going to make this easy for entries, you really just need to commit to a price and stick with it.
To hit $33,099 on entry you needed to have that level set with the orders placed as that move happened very fast. I don’t believe market makers will allow retail another entry at $33,099 (but what do I know, i’m not a maker) and the best we could see is a retest of the $34,484 level on the way down as we paint the new monthly candle.
I’ve taken the time to backtest my strategies and try them historically. Looking back in time starting at the 2013 cycle, I’ve marked 3 simple candles: Start of the uptrend ($13.50), Cycle Top ($185), and the Swing Level ($47.24).
Now taking a look at the end of 2013 cycle, i’ve marked 4 candles: End of 2013 Cycle Top ($1,119), the Swing Level ($325), Start of the Uptrend ($123), and the 2012-2013 Cycle Top level ($185).
The 2017 bull run has a few more lines, disregard them for now except for the start fo the uptrend, swing level, and the 2017 bull run all time high price.
Now with all of these previous cycles in mind, let’s take a look at a few glaring similarities. It’s obvious that Bitcoin moves in cycles, however, understanding the lengths and depths of these cycles isn’t so obvious.
(Side note: You can find the Bitcoin Cycle Top Indicator on my profile page, ‘add to favorites / like’ the indicator to add it to your chart)
After Bitcoin has its blow-off top, it is soon followed by a heavy market correction. Something to notice is that Bitcoin has always pulled back to the Swing level, not the start of the uptrend. Bitcoin has never pulled back and retraced 100% of its gains to the start of the uptrend, and instances where the Swing Level gets front ran, like in 2013, it is followed by an extended period of accumulation before the next leg up. This exact pattern occured in 2017, where Bitcoin front-ran the Swing Level by only a few $, but because of that it had to endure a 4-year bear market.
Based on historical data, if we front-run the Swing Level after the Cycle Top, we should expect a 3-4 year bear market, followed by another blow-off top.
Now let’s move onto the current cycle, 2021. Just like every cycle before, i’ve marked the start of the uptrend, the swing level, and the 2021 Cycle Top. In Summer 2021, we’ve already backtested the Swing Level, therefore it was a valid move upwards going into the end of the year.
The start of the uptrend is placed at $18,967 (and I was very liberal with that placement, it really starts at $10,524 with a LG at $12,775) and just like every cycle previous, this one doesn’t look like it’s going to come back down and retest there (knock on wood).
Now, taking a look at the CME Futures (BTC1!) on the 2-day time frame, we can see the liquidity gap that has filled at $32,930. This backtested to a Tee, not a dollar over or under, and is now primed to move up. I strongly believe that the market makers will not let retail get an institutional level entry, however, that is simply not up to me.
Bitcoin has historically backtested all of the levels it needs to in order to move up properly without exhaustion, closed the liquidity gap on the CME Futures, and is increasingly becoming more scarce on exchanges day by day.
As always please do your own research, this does not constitute as financial advice as this information is for educational purposes only.
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