Here is the chart of the Bitcoin vertical. I like to give the future its place in such charts, because in the end it’s the future we care about. The blank on the right is where will either make or lose money so it is good to leave it blank sometimes rather than fill it like a frame with price action.
These are the bull and bear cases: Reader should know I’m in the bear camp right now, but lets have a close look at the price action. Using the old 1950’s technique you would say this is what you have to watch to see if Bull or Bear is where it is at: It is a primitive approach but one that often comes in very handy. The boxes encapsulate the volatility and moves beyond suggest a repricing is underway. but I cant help feeling that Crypto markets are quite simple, and that is because the market is not filled to the brim with a plethora of players like hedge funds and investment banks with their army of quants with their legions of bots.
It is an even wider range that at $40,000. For a bull that cares about the short and medium term, Bitcoin really has to continue to rise of its parabolic the curve if it is to maintain its vertical and to do that is will have to go vertical again soon. For a bear there is plenty of insanity in the market in general and in Crypto in particular to put them in a world of hurt but of course you can avoid most of that if you do not short and frankly if you short Crypto you need to have a hot line put in to your therapist. However the clock is ticking for Bitcoin to make the move above $60,000 but there is still time as you can see this chart that examines the time to break out on the last equilibrium level.
Markets rarely go sideways and most would agree its either heaven or hell for Crypto in the next few months and the current levels are only temporary one way or another. Bitcoin is almost certainly not going to do this. And even if it did it would be bearish. There remains more downside with a greater likelihood and less upside with less likelihood so the only reason to hold now is because you are very sure indeed its going to go on another rally. A lot of people are and that is an impress amount of faith. That kind of faith has worked out well for holders of stocks like Apple, Amazon and Tesla and believers will point to this as a reason to hold for ever for a titanic ascent. I wish them well but valuations in billions is one thing, trillions is a different scale entirely and for Bitcoin to break into a valuation of multiple trillions seems, at least for now, a hard goal to reach.
I’m out of BTC, Ethereum and DeFi as far a position trading goes. If Bitcoin break up over $60,000 I might reenter DeFi, if it breaks down I will await the bottom and re-enter then.