Bitcoin Weekly Review August 18th - August 25th
This review will focus on four issues:
1. When is the bottom?
2. At what price?
3. If we make a definitive bottom, will a fresh upward impulse follow? Or is it just a relief rally?
4. What is the likely target to the upside?
TLDR:
• The trading week beginning on August 19th will likely be a substantial low, followed by a rally. The bottom will likely be after August 19th.
• The absolute bottom (for now) is 45K. If Bitcoin makes an HL above 49K, it is a bullish signal for continuation.
• Even if Bitcoin makes an HL above 49K, a bullish continuation to a substantial ATH is doubtful. My most optimistic projection is 85K.
• The “line in the sand” is 61K. If Bitcoin holds 61K, expect a continuation and vice versa.
A. When is the Bottom?
A.1. Mercury Cycles:
Mercury cycles are based on Mercury’s 88-day orbit around the Sun. There is some correlation between the end of a Mercury cycle and a change in trend. However, it’s not reliable enough. The current mercury cycle ends on August 26th and may herald a trend change.
A.2. 30-Week cycles:
Measuring Bitcoin Cycles on the weekly cycles from one low to the next, it is possible to divide the cycles into 15-week cycles and 30-week cycles. The 15-week cycle measurement doesn’t have good proportions because of deviations.
Figure 1: 15-week cycles
The 30-week cycle is consistent and reliable. In this cycle, the 30-week cycle plays out perfectly. The data points to a macro bottom this week beginning on August 19th.
Figure 2: 30-week cycles.
A.3. Financial Astrology:
A.3.1 Bitcoin Horoscope:
Between August 17th and August 19th, transiting Mars will square Bitcoin’s natal Uranus. This challenging aspect brings increased volatility and the possibility of a trend change. The change in trend is unlikely to occur while this aspect actively influences Bitcoin’s chart, but a day or two after this aspect has run its course. Accordingly, we can expect a trend change after August 19th.
A.3.2 General Astrology:
Even if we disregard Bitcoin’s transits, the astrology of the coming week (beginning on August 18th) is somewhat challenging. August 19th is particularly auspicious and looks like a prime candidate for a low because Venus in Virgo forms a T-square with Saturn in Pisces and Jupiter and Mars in Gemini
These are the active aspects for August 19th:
1. Sun, Conjunct, Mercury. Neutral.
2. Sun, Square, Uranus. Negative.
3. Mercury, Square, Uranus. Increased volatility.
4. Venus, Square, Jupiter. Conflict.
5. Venus, Opposition, Saturn. Conflict.
6. Jupiter, Square, Saturn. Conflict.
7. Neptune, Sextile, Pluto. Positive.
B. At what price will Bitcoin find support?
B.1. Volume Profile:
From a volume perspective, Bitcoin lost a high-volume zone when it dropped below the distribution range-low of 60.8K.
The next volume support is the zone between the VAH at approximately 45K and 41.5K.
This is a “do or die” level for Bitcoin. If Bitcoin loses this volume cluster, the bull market will be over.
Figure 5: Bitcoin cycle volume profile.
B.2. Elliot Wave Count:
From an EW perspective, Bitcoin is in the process of making a complex correction in wave 4. Bitcoin reached 0.5 retracement of wave 3 at 49K and lost the acceleration channel. If the 0.5 retracement holds and Bitcoin makes a double bottom, it will be a macro-low signal.
If Bitcoin loses the 0.618 retracement, the chances are that this is a failed cycle, and Bitcoin will head lower.
Figure 6: Bitcoin cycle EW count.
B.3. Gann analysis:
The 1/1 Gann angle points to the possibility of a low at 45K. However, this doesn’t mean that the price must go there; it is merely that 45K is a strong support level that will likely hold.
B.4. Wick Fill strategy:
The wick-fill strategy gives us a few support targets:
1. 50% of the wick on the 1W chart: 53K. In confluence with the 50W EMA.
2. 50% of the wick on the daily chart: 51.5K.
3. 100% of the wick at 49K.
Figure 7: Bitcoin Gann & wick-fill.
B.5. Classical Charting:
According to classical charting techniques, Bitcoin’s price forms a Descending Broadening Wedge. The wedge support is 45K, coinciding with the cycle 50% retracement and the 1/1 Gann angle.
Figure 8: Descending broadening wedge.
B.6. Bitcoin Support Levels:
a) 53.5K (50% of the weekly Wick, 50W EMA).
b) 51.5K (50% of the daily wick).
c) 49K (previous LL).
d) 45K (horizontal support, high-volume node).
I will look to buy between 49K and 51.5K. This is my assessment. Regardless, because there is no definitive level, it may be a good idea to wait until after August 19th to confirm a bottom in place.
C. Is Bullish Continuation Likely?
The evidence for continuing the bull trend mainly relies on historic PA patterns. The fact that the four-year cycle held in the past does not guarantee future performance. Also, the macroeconomic conditions today are different. There is no historical record to compare Bitcoin’s performance in a recession. Low interest rates, low unemployment, and economic growth characterized the past 13 years of Bitcoin’s existence. The situation has changed, and we need to adapt.
C.1. The Bear Case:
C.1.1 Wyckoff Distribution:
It appears as if Bitcoin completed a Wyckoff distribution schematic. The last LH of 62.8K was the Last Point of Supply, and if the price stays below 62.8K, I expect lower prices.
Figure 9: Bitcoin Wyckoff Distribution.
C.1.2 Market Structure:
Bitcoin M.S. since March 13th, 2024, is indicative of a downtrend. The price is making LHs and LLs. “The trend is your friend until it ends.” Until the price makes an HH above 70K or an HL above 62.8K, I expect a continuation to the downside.
Figure 10: Bitcoin M.S.
C.2. Neutral:
C.2.1. EW Analysis:
The fact that Bitcoin lost its acceleration channel is bearish. If Bitcoin drops below the 0.5 retracement, it will exacerbate the situation because a bullish continuation in wave 4 below 0.5 retracement is doubtful. Even if Bitcoin rebounds from the 0.5 retracement, it is possible for the 5th wave to top at 64.6K. Frankly, it is A maximum pain and confusion scenario. See Figure 6.
D. Continuation Targets:
1. Bullish Continuation Targets:
If Bitcoin holds the 49K level and reverses course, the optimistic wave 5 projection is 85K.
If wave 5 matches wave 1, it will only reach 64.6K.
Some analysts, are calling for a “melt-up” phase preceding a 1929-style crash. I doubt if we will see a melt-up in the crypto market. If we do, 107K is the maximum. Although, I doubt it will happen. see figure 6.
2. Bearish Continuation Targets:
The immediate significant support level is 49K. However, if Bitcoin continues the current trend, I expect the next target to be 45K. see figure 5
Best Wishes
NTC
1. When is the bottom?
2. At what price?
3. If we make a definitive bottom, will a fresh upward impulse follow? Or is it just a relief rally?
4. What is the likely target to the upside?
TLDR:
• The trading week beginning on August 19th will likely be a substantial low, followed by a rally. The bottom will likely be after August 19th.
• The absolute bottom (for now) is 45K. If Bitcoin makes an HL above 49K, it is a bullish signal for continuation.
• Even if Bitcoin makes an HL above 49K, a bullish continuation to a substantial ATH is doubtful. My most optimistic projection is 85K.
• The “line in the sand” is 61K. If Bitcoin holds 61K, expect a continuation and vice versa.
A. When is the Bottom?
A.1. Mercury Cycles:
Mercury cycles are based on Mercury’s 88-day orbit around the Sun. There is some correlation between the end of a Mercury cycle and a change in trend. However, it’s not reliable enough. The current mercury cycle ends on August 26th and may herald a trend change.
A.2. 30-Week cycles:
Measuring Bitcoin Cycles on the weekly cycles from one low to the next, it is possible to divide the cycles into 15-week cycles and 30-week cycles. The 15-week cycle measurement doesn’t have good proportions because of deviations.
Figure 1: 15-week cycles
The 30-week cycle is consistent and reliable. In this cycle, the 30-week cycle plays out perfectly. The data points to a macro bottom this week beginning on August 19th.
Figure 2: 30-week cycles.
A.3. Financial Astrology:
A.3.1 Bitcoin Horoscope:
Between August 17th and August 19th, transiting Mars will square Bitcoin’s natal Uranus. This challenging aspect brings increased volatility and the possibility of a trend change. The change in trend is unlikely to occur while this aspect actively influences Bitcoin’s chart, but a day or two after this aspect has run its course. Accordingly, we can expect a trend change after August 19th.
A.3.2 General Astrology:
Even if we disregard Bitcoin’s transits, the astrology of the coming week (beginning on August 18th) is somewhat challenging. August 19th is particularly auspicious and looks like a prime candidate for a low because Venus in Virgo forms a T-square with Saturn in Pisces and Jupiter and Mars in Gemini
These are the active aspects for August 19th:
1. Sun, Conjunct, Mercury. Neutral.
2. Sun, Square, Uranus. Negative.
3. Mercury, Square, Uranus. Increased volatility.
4. Venus, Square, Jupiter. Conflict.
5. Venus, Opposition, Saturn. Conflict.
6. Jupiter, Square, Saturn. Conflict.
7. Neptune, Sextile, Pluto. Positive.
B. At what price will Bitcoin find support?
B.1. Volume Profile:
From a volume perspective, Bitcoin lost a high-volume zone when it dropped below the distribution range-low of 60.8K.
The next volume support is the zone between the VAH at approximately 45K and 41.5K.
This is a “do or die” level for Bitcoin. If Bitcoin loses this volume cluster, the bull market will be over.
Figure 5: Bitcoin cycle volume profile.
B.2. Elliot Wave Count:
From an EW perspective, Bitcoin is in the process of making a complex correction in wave 4. Bitcoin reached 0.5 retracement of wave 3 at 49K and lost the acceleration channel. If the 0.5 retracement holds and Bitcoin makes a double bottom, it will be a macro-low signal.
If Bitcoin loses the 0.618 retracement, the chances are that this is a failed cycle, and Bitcoin will head lower.
Figure 6: Bitcoin cycle EW count.
B.3. Gann analysis:
The 1/1 Gann angle points to the possibility of a low at 45K. However, this doesn’t mean that the price must go there; it is merely that 45K is a strong support level that will likely hold.
B.4. Wick Fill strategy:
The wick-fill strategy gives us a few support targets:
1. 50% of the wick on the 1W chart: 53K. In confluence with the 50W EMA.
2. 50% of the wick on the daily chart: 51.5K.
3. 100% of the wick at 49K.
Figure 7: Bitcoin Gann & wick-fill.
B.5. Classical Charting:
According to classical charting techniques, Bitcoin’s price forms a Descending Broadening Wedge. The wedge support is 45K, coinciding with the cycle 50% retracement and the 1/1 Gann angle.
Figure 8: Descending broadening wedge.
B.6. Bitcoin Support Levels:
a) 53.5K (50% of the weekly Wick, 50W EMA).
b) 51.5K (50% of the daily wick).
c) 49K (previous LL).
d) 45K (horizontal support, high-volume node).
I will look to buy between 49K and 51.5K. This is my assessment. Regardless, because there is no definitive level, it may be a good idea to wait until after August 19th to confirm a bottom in place.
C. Is Bullish Continuation Likely?
The evidence for continuing the bull trend mainly relies on historic PA patterns. The fact that the four-year cycle held in the past does not guarantee future performance. Also, the macroeconomic conditions today are different. There is no historical record to compare Bitcoin’s performance in a recession. Low interest rates, low unemployment, and economic growth characterized the past 13 years of Bitcoin’s existence. The situation has changed, and we need to adapt.
C.1. The Bear Case:
C.1.1 Wyckoff Distribution:
It appears as if Bitcoin completed a Wyckoff distribution schematic. The last LH of 62.8K was the Last Point of Supply, and if the price stays below 62.8K, I expect lower prices.
Figure 9: Bitcoin Wyckoff Distribution.
C.1.2 Market Structure:
Bitcoin M.S. since March 13th, 2024, is indicative of a downtrend. The price is making LHs and LLs. “The trend is your friend until it ends.” Until the price makes an HH above 70K or an HL above 62.8K, I expect a continuation to the downside.
Figure 10: Bitcoin M.S.
C.2. Neutral:
C.2.1. EW Analysis:
The fact that Bitcoin lost its acceleration channel is bearish. If Bitcoin drops below the 0.5 retracement, it will exacerbate the situation because a bullish continuation in wave 4 below 0.5 retracement is doubtful. Even if Bitcoin rebounds from the 0.5 retracement, it is possible for the 5th wave to top at 64.6K. Frankly, it is A maximum pain and confusion scenario. See Figure 6.
D. Continuation Targets:
1. Bullish Continuation Targets:
If Bitcoin holds the 49K level and reverses course, the optimistic wave 5 projection is 85K.
If wave 5 matches wave 1, it will only reach 64.6K.
Some analysts, are calling for a “melt-up” phase preceding a 1929-style crash. I doubt if we will see a melt-up in the crypto market. If we do, 107K is the maximum. Although, I doubt it will happen. see figure 6.
2. Bearish Continuation Targets:
The immediate significant support level is 49K. However, if Bitcoin continues the current trend, I expect the next target to be 45K. see figure 5
Best Wishes
NTC
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