Bitcoin's Final Make Or Break Moment
Updated
This is my first post in some time. As I stated before, I'm largely moving on from crypto. I'm still here, paying attention to the market. I've also created a site for my fiction writing. Eventually, I may migrate some of these posts over there as representations of my non-fiction speculative market analysis.
Anyway, on to the important stuff.
Bitcoin did not succeed as a currency. Active addresses have still not seen any meaningful increase since 2017. The rate of growth for authentic currency adoption has slowed down along with price growth and expensiveness. studio.glassnode.com/metrics?a=BTC&m=addresses.ActiveCount
There are only about 1 million active addresses. Nevertheless, price continues to be resilient. Perhaps this is due to its limited supply and its pivot in narrative to a "store of value." Indeed, it has been a pretty lucrative store of value, though more volatile than the stock market and other commodities. This doesn't necessarily make it a "good" store of value.
Regardless of what I think, the market will make its decision. Now is the time for that to happen. With ETFs supposedly on the horizon, we will get to see how much demand really exists for Bitcoin.
I'm going to take this moment to speculate a bit. If it continues to go up, my guess is it will be because of the ETF hype, but volume amongst most spot exchanges will remain low. Bitcoin dominance would likely rise to levels not seen since 2019. If it results in a bubble, eventually people will come to their senses and there will be a pop. It will attract a lot of media and government attention, not all of it positive.
If it drops from here, it will be like all the other times people had high hopes for Bitcoin. It will be like all the times Bitcoin was supposed to represent economic freedom. It will be like every single time Bitcoin made major news, only for everyone to talk about it just as it was about to crash. It will not come as any surprise.
If the ETFs fail to sustain the market to new highs, then I think there is little other chance for this asset, at least in the near future, until some other narrative takes hold. The thing exists, and as long as it does, people will ascribe their hopes, dreams, and (in my case) disdain towards it.
What would be a departure would be continued price appreciation and adoption. But, with a finite supply, there is of course a limit to how much people can buy. Then, what happens to it?
We shouldn't forget the other side of this market (apart from the ETF hype and the coin accumulation that requires). Binance is still a thing. BNB is still a juggernaut. Tron is still a thing, and so is the big stablecoin cartel which likely revolves around both.
But I'll spare you all my other thoughts on this subject. I just wanted to post a chart update, to show that I'm at least paying attention.
As for technicals, my chart shows two options. If it continues to hold in this broadening wedge pattern, the next target could be 90k, or roughly 2x from here, surpassing the previous all time high. As much as my previous analysis will be wrong if that happens, it's a possibility. The other scenario shows what could happen on a breakdown, back below the broadening pattern.
Here's the BLX chart, showing that Bitcoin has so far been rejected at a former long term trendline. This chart shows some more possibilities.
Let's see if it can break back above.
Zoomed out:
Either way, prepare for volatility!
As always, thank you so much for reading. This is not financial advice, but meant for speculation and entertainment only.
-Victor Cobra
Anyway, on to the important stuff.
Bitcoin did not succeed as a currency. Active addresses have still not seen any meaningful increase since 2017. The rate of growth for authentic currency adoption has slowed down along with price growth and expensiveness. studio.glassnode.com/metrics?a=BTC&m=addresses.ActiveCount
There are only about 1 million active addresses. Nevertheless, price continues to be resilient. Perhaps this is due to its limited supply and its pivot in narrative to a "store of value." Indeed, it has been a pretty lucrative store of value, though more volatile than the stock market and other commodities. This doesn't necessarily make it a "good" store of value.
Regardless of what I think, the market will make its decision. Now is the time for that to happen. With ETFs supposedly on the horizon, we will get to see how much demand really exists for Bitcoin.
I'm going to take this moment to speculate a bit. If it continues to go up, my guess is it will be because of the ETF hype, but volume amongst most spot exchanges will remain low. Bitcoin dominance would likely rise to levels not seen since 2019. If it results in a bubble, eventually people will come to their senses and there will be a pop. It will attract a lot of media and government attention, not all of it positive.
If it drops from here, it will be like all the other times people had high hopes for Bitcoin. It will be like all the times Bitcoin was supposed to represent economic freedom. It will be like every single time Bitcoin made major news, only for everyone to talk about it just as it was about to crash. It will not come as any surprise.
If the ETFs fail to sustain the market to new highs, then I think there is little other chance for this asset, at least in the near future, until some other narrative takes hold. The thing exists, and as long as it does, people will ascribe their hopes, dreams, and (in my case) disdain towards it.
What would be a departure would be continued price appreciation and adoption. But, with a finite supply, there is of course a limit to how much people can buy. Then, what happens to it?
We shouldn't forget the other side of this market (apart from the ETF hype and the coin accumulation that requires). Binance is still a thing. BNB is still a juggernaut. Tron is still a thing, and so is the big stablecoin cartel which likely revolves around both.
But I'll spare you all my other thoughts on this subject. I just wanted to post a chart update, to show that I'm at least paying attention.
As for technicals, my chart shows two options. If it continues to hold in this broadening wedge pattern, the next target could be 90k, or roughly 2x from here, surpassing the previous all time high. As much as my previous analysis will be wrong if that happens, it's a possibility. The other scenario shows what could happen on a breakdown, back below the broadening pattern.
Here's the BLX chart, showing that Bitcoin has so far been rejected at a former long term trendline. This chart shows some more possibilities.
Let's see if it can break back above.
Zoomed out:
Either way, prepare for volatility!
As always, thank you so much for reading. This is not financial advice, but meant for speculation and entertainment only.
-Victor Cobra
Note
And…of course there’s the option where the ETFs are denied, and the carrot on a stick situation continues. This would likely result in a sizable drop in price and a breakdown from the broadening wedge again. The shenanigans that just occurred on Twitter gives little confidence to investors. Yet again, this space proves why it is not to be taken seriously.Note
The Bitcoin community has given a lot of supposed evidence that the ETF’s will be approved. We’ll see! Evidence broadly suggests that the crypto market is still manipulated, and the true influence of stablecoins is not entirely accounted for. Not surprised in the slightest by what’s going on. You can’t attach yourself to a narrative and expect to make money.Note
Great start to the day for ETF investors. A daily close around these levels or below on high volume could signal a reversal to the downside. The failed high at
49K is already looking a bit like breakout failure. However, buys can always take things back up before day's end. Note
Looks pretty terrible now. Completely unsurprised that the ETFs resulted in a liquidity grab for sellers and then a reversal to the downside. My speculation is that those ETFs never generate profit for investors.Note
Traders clearly think this trendline is important. Below, there isn't much support until the $31-33k area. Note
It's been some months since my last update. As we know, BTC ended up rallying after the initial ETF selloff, even though overall spot volume doesn't look great. This was against my initial speculation. Bitcoin broke its all time high by little more than 5%, which doesn't quite factor in inflation. Really, it simply touched the highs from the last cycle peak. My speculation has generally been that Bitcoin will have a hard time maintaining a new all time high, if making it there at all. I'm not quite convinced yet. However, the bullish structure remains intact. This correction makes a lot of sense - though Bitcoin was not able to make it to the upper bounds of the broadening wedge. Right now, it's getting close to the lower trendline again, which is currently near 54k. Let's see what happens! Here are a couple of scenarios. Note
By the way, I shorted on the way up and closed to minimize losses in case of an explosive move upwards towards 80k. That didn't happen. Instead, I re-opened my short around 
67K and added at 71k. I plan to close depending on action here in the $50's, or if Bitcoin can sustain above 71k.Note
Looking at the monthly chart, it seems very reasonable to expect price to revisit the 9 month EMA (orange), currently near 51k. Note
It's looking like Bitcoin will try to test the 9 month EMA in July. Currently at 54.5k. Closing below is when the trend begins to shift more bearish on broader timeframes. A longer term monthly bearish divergence continues to exist, showing weakening conviction over time. This is another reason I'm longer term bearish on this asset. Note
After failing to sustain significant new highs, Bitcoin has broken below the uptrend held since Dec. 2022. The 9 month EMA was indeed tested in July, and has a chance to close below in August. Note
The 50 month MA (red) is the next major MA support, below 37k All points to $36-38k being a major confluence of support, in the event of a capitulation/liquidity event. My speculation is that overall prices can head even lower than 2022, but we're not quite there yet. Still need to see if any bottoming behavior begins to occur within the coming days/weeks. Structurally, things look pretty terrible. Especially for ETH.
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