The Bigger Picture
We are reaching a critical turning point for Bitcoin. As you can see in the chart, there are numerous factors that can aid in predicting where Bitcoin will go next. There are two houses of thought that I have seen as we approach this critical point. I have marked the daily chart with what I believe to be Left, Head, and potential right shoulders of a larger H&S pattern that we could see. A drop to the first horizontal blue line may be inevitable in the coming days, but what it does there could determine the future (barring a black swan event). While I would like to believe that a fall to this low support would cause a significant pump back up to create a right shoulder to finish out the H&S pattern, there are some fundamental points that should be considered. To create a pump this large, sentiment would have to increase significantly and volume would need to increase in a like manner. With volume reaching all-time lows, the potential for investors to rationally view this support as a credible buying point may be much lower than when the pump to form the head was generated. Because of such low volume, regulatory outlook, and what I believe to be blatant manipulation within the Tether ecosystem, I cannot accurately and with a sound mind predict whether Bitcoin will bounce or reject. My gut feeling is that there is a 48% chance of a bounce and 52% chance at a rejection based on current market conditions and sentiment. Though 52% confidence is not necessarily grounds for a short position, it is my belief that there will be a black swan event of some kind that will cause Tether to lose its peg to the dollar in the near future. With this as my underlying belief, I am short Bitcoin via derivative securities at this time. Regardless of sentiment and news, the reality is that investor money interested in purchasing Bitcoins is far less than it was months ago when sentiment and future outlook saved the direction of BTC. Without additional capital, there will be no logical methodology behind a pump as significant as before.
My prediction is as follows
1.) Bitcoin will reach the first horizontal blue support and there will be significant volatility as the war for option spreads begins.
2.) Regulatory measures or analysis will be released spooking the market creating a dump (though inorganic as it may be)
3.) Tether market cap increases if my prediction that current BTC prices are being supported by printing and subsequent purchasing of BTC with newly printed Tether. (Nothing to lose theory)
4.) Price bounces as if to signal a right shoulder formation, failing nearly halfway through completion.
5.) New all-time low and complete failure of technical indicators.
6.) Exchanges begin to fail, with smaller-cap markets first and larger to follow.
7.) Tether collapses and Bitcoin regains stability around 15k only to continue a downtrend for years before bottoming out.
Though I do not wish for this to be true, I still believe that blockchain will live on (Though strictly regulated by governing bodies). Ultimately governments hold too much power to allow cryptocurrencies to be controlled by third-party exchanges and will absorb existing forms of transaction into a new centralized form of execution. This has, and must, be true of all past, present, and future currencies. We are at the height of mania, I'm afraid, and the foundations of what comes next have already been laid. Sataoshi Nakamoto was a genius in accounting for nearly every eventuality within the blockchain ecosystem, but he failed to account for one thing; corporate greed. The blockchain was intended to be a means by which INDIVIDUALS can transact with one another without government intervention, but the current state of the blockchain is equivalent to an ancient Roman city, now lost to time and scarred by the greed and destruction that plagued it. Corporations are seizing the means of production and the creation of stable coins marred the very integrity that gave hope to the cryptocurrency environment.
The Past is Prologue, and the wax is beginning to drip from Icarus's wings.
My prediction is as follows
1.) Bitcoin will reach the first horizontal blue support and there will be significant volatility as the war for option spreads begins.
2.) Regulatory measures or analysis will be released spooking the market creating a dump (though inorganic as it may be)
3.) Tether market cap increases if my prediction that current BTC prices are being supported by printing and subsequent purchasing of BTC with newly printed Tether. (Nothing to lose theory)
4.) Price bounces as if to signal a right shoulder formation, failing nearly halfway through completion.
5.) New all-time low and complete failure of technical indicators.
6.) Exchanges begin to fail, with smaller-cap markets first and larger to follow.
7.) Tether collapses and Bitcoin regains stability around 15k only to continue a downtrend for years before bottoming out.
Though I do not wish for this to be true, I still believe that blockchain will live on (Though strictly regulated by governing bodies). Ultimately governments hold too much power to allow cryptocurrencies to be controlled by third-party exchanges and will absorb existing forms of transaction into a new centralized form of execution. This has, and must, be true of all past, present, and future currencies. We are at the height of mania, I'm afraid, and the foundations of what comes next have already been laid. Sataoshi Nakamoto was a genius in accounting for nearly every eventuality within the blockchain ecosystem, but he failed to account for one thing; corporate greed. The blockchain was intended to be a means by which INDIVIDUALS can transact with one another without government intervention, but the current state of the blockchain is equivalent to an ancient Roman city, now lost to time and scarred by the greed and destruction that plagued it. Corporations are seizing the means of production and the creation of stable coins marred the very integrity that gave hope to the cryptocurrency environment.
The Past is Prologue, and the wax is beginning to drip from Icarus's wings.
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.