BTC Road Map & Cheat Sheet - Black Week Rebound - 20 MAR 2020
By Bulgogi_Cheese_Ramyun 20 MAR 2020
BLUF: Expect Volatility as we rebound from "Black Week" and consolidate through halving and beyond
C.R.A.P. Analysis:
1) CHART: The chart is modified slightly to tighten near side and more closely accommodate the recovery from the flash crash.
2) RELEVANT FACTORS:
a) Investor confidence. Despite the recent flash crash sending some investors and traders running for more security, BTC remains a highly volatile speculative tradeable asset with a strong following. The recent rebound may bring speculative investors back in, as BTC is the single largest commodity with significant gains during this period. Furthermore, BTC and cryptocurrency market in general appears to be leading the stock and financial markets in recovery.
b) History & Cycles: Crashes of epic proportions are usually followed by epic rebounds. We saw this recently as BTC rebounded from a low of approximately $3,800 to $7K, about 84% gain in a matter of days when the rest of the markets continue to sink.
c) Coronavirus: We still have only seen the tip of the iceberg. The World Health Organization (WHO) declared the Coronavirus a PANDEMIC on 11 MAR 2020. Since then, globally, travel and events of mass gathering are being cancelled at rates never before seen. Supply chain shortages and CV FUD triggered a global stock sell-off and gold price volatility which are in league with bitcoin volatility. A mix of good and bad coronavirus news are filling inexperienced investors with alternating Hopium and FUD and this is translating into asset price volatility. Recent good news was announced as Wuhan, China reported no new cases. Additionally, U.S. President Trump announced promising results in treating patients with existing medications. Still, over the next 3-4 weeks, I expect Covid-19 numbers to multiply many times over in the USA and globally. After sell-off, assets are being held in fiat currencies more so than other traditional safehavens such as gold and U.S. Treasuries. Whales may be preparing to transfer wealth to bitcoin, but that transfer may continue for some time, especially if bitcoin, stocks, and gold continue their decline as whales will attempt to purchase at bargain prices. BE CAREFUL NOT TO MISTAKE A DEAD CAT BOUNCE FOR A REVERSAL!
d) Media Influence: As predicted, U.S. media returned focus on the Coronavirus spread, government inaction, and the global economic impact, spreading FUD amongst investors, and tanking the market yet again. As media shifts focus to recovery and adaptation, I expect fear to minimize, and most markets to rebound. It is strongly possible media will address Bitcoin’s departure from correlation with stock markets and the significant gains in BTC while gold remains mostly steady and stocks remain low. If that happens, expect a strong boom in Bitcoin.
e) Global Recession: We alternated Dead Cat Bounces and more declines as we continued down the rocky slope beyond Black Monday into an official Bear Market. But it is not over. As indicators mount which are eerily reminiscent of the 2008 Global Financial Crisis, Bitcoin prices have declined similarly until good coronavirus moves. I believe two week's ago, stock market declines were also "tip of the iceberg" and last week, we saw part of the submerged iceberg. This week, we saw volatility in all markets, with bitcoin leading the markets in a potential rebound. I expect many short-lived "dead cat bounces" as we continue a volatile period with a strong possibility of milder but sustained declines ahead before recovery is complete. I expect Bitcoin to lead the rest of the markets out of decline.
f) Halving: The Halving calculated for 10-12 May 2020 will reduce the available supply of new bitcoin to the market, creating scarcity and resulting in price increase. Historically the BTC price was at a relative low during halvening and the reduced supply is what drove the price of BTC upward significantly after the previous two halvings. The current socioeconomic conditions will reduce the rate at which the halving increases BTC price until those socioeconomic conditions improve.
3) ANALYSIS: Bitcoin appears to be rebounding strongly. If socioeconomic conditions can maintain or improve, we have likely seen bottom. Otherwise, if global conditions worsen, we may return to $3k range again.
4) PREDICTION: Volatility and uncertainty to continue until news on coronavirus spread & impact improves or massive whale movement, whichever comes first. Current momentum, if sustained, will keep us below $10K through halving, after which, we should start to see significant price increase as the available supply of new BTC declines significantly. If socioeconomic conditions maintain or improve, this is the start of a massive bull run which will continue through halving and end in a year or two from now at a new ATH. Due to the coronavirus impact, stunted economics will reduce the slope of BTC price rise until economic conditions improve.
BLUF: Expect Volatility as we rebound from "Black Week" and consolidate through halving and beyond
C.R.A.P. Analysis:
1) CHART: The chart is modified slightly to tighten near side and more closely accommodate the recovery from the flash crash.
2) RELEVANT FACTORS:
a) Investor confidence. Despite the recent flash crash sending some investors and traders running for more security, BTC remains a highly volatile speculative tradeable asset with a strong following. The recent rebound may bring speculative investors back in, as BTC is the single largest commodity with significant gains during this period. Furthermore, BTC and cryptocurrency market in general appears to be leading the stock and financial markets in recovery.
b) History & Cycles: Crashes of epic proportions are usually followed by epic rebounds. We saw this recently as BTC rebounded from a low of approximately $3,800 to $7K, about 84% gain in a matter of days when the rest of the markets continue to sink.
c) Coronavirus: We still have only seen the tip of the iceberg. The World Health Organization (WHO) declared the Coronavirus a PANDEMIC on 11 MAR 2020. Since then, globally, travel and events of mass gathering are being cancelled at rates never before seen. Supply chain shortages and CV FUD triggered a global stock sell-off and gold price volatility which are in league with bitcoin volatility. A mix of good and bad coronavirus news are filling inexperienced investors with alternating Hopium and FUD and this is translating into asset price volatility. Recent good news was announced as Wuhan, China reported no new cases. Additionally, U.S. President Trump announced promising results in treating patients with existing medications. Still, over the next 3-4 weeks, I expect Covid-19 numbers to multiply many times over in the USA and globally. After sell-off, assets are being held in fiat currencies more so than other traditional safehavens such as gold and U.S. Treasuries. Whales may be preparing to transfer wealth to bitcoin, but that transfer may continue for some time, especially if bitcoin, stocks, and gold continue their decline as whales will attempt to purchase at bargain prices. BE CAREFUL NOT TO MISTAKE A DEAD CAT BOUNCE FOR A REVERSAL!
d) Media Influence: As predicted, U.S. media returned focus on the Coronavirus spread, government inaction, and the global economic impact, spreading FUD amongst investors, and tanking the market yet again. As media shifts focus to recovery and adaptation, I expect fear to minimize, and most markets to rebound. It is strongly possible media will address Bitcoin’s departure from correlation with stock markets and the significant gains in BTC while gold remains mostly steady and stocks remain low. If that happens, expect a strong boom in Bitcoin.
e) Global Recession: We alternated Dead Cat Bounces and more declines as we continued down the rocky slope beyond Black Monday into an official Bear Market. But it is not over. As indicators mount which are eerily reminiscent of the 2008 Global Financial Crisis, Bitcoin prices have declined similarly until good coronavirus moves. I believe two week's ago, stock market declines were also "tip of the iceberg" and last week, we saw part of the submerged iceberg. This week, we saw volatility in all markets, with bitcoin leading the markets in a potential rebound. I expect many short-lived "dead cat bounces" as we continue a volatile period with a strong possibility of milder but sustained declines ahead before recovery is complete. I expect Bitcoin to lead the rest of the markets out of decline.
f) Halving: The Halving calculated for 10-12 May 2020 will reduce the available supply of new bitcoin to the market, creating scarcity and resulting in price increase. Historically the BTC price was at a relative low during halvening and the reduced supply is what drove the price of BTC upward significantly after the previous two halvings. The current socioeconomic conditions will reduce the rate at which the halving increases BTC price until those socioeconomic conditions improve.
3) ANALYSIS: Bitcoin appears to be rebounding strongly. If socioeconomic conditions can maintain or improve, we have likely seen bottom. Otherwise, if global conditions worsen, we may return to $3k range again.
4) PREDICTION: Volatility and uncertainty to continue until news on coronavirus spread & impact improves or massive whale movement, whichever comes first. Current momentum, if sustained, will keep us below $10K through halving, after which, we should start to see significant price increase as the available supply of new BTC declines significantly. If socioeconomic conditions maintain or improve, this is the start of a massive bull run which will continue through halving and end in a year or two from now at a new ATH. Due to the coronavirus impact, stunted economics will reduce the slope of BTC price rise until economic conditions improve.
