Fuelled by the perfect storm of uncertainty in Asia, regulatory pressure in the US, lack of market exuberance and over extension in price action, the 100d MA Bull to Bear Cycle has now completed with price action hitting the 100d MA support on 16/01/18.
The current cycle lasted a total of 124 days, which is an over extension of 8d past the average of 115d.
The performance of this cycle was a positive 298% increase, representing the largest post 2014 100d MA Bull to Bear Cycle performance gain.
| Detail |
Charting the bull to bear price action back to 2012, I was able to then create a picture of the market cycles based on the 100d MA acting as support. My rationale behind this was that as markets are cyclical I wanted to gain a view point from a long term investing perspective allowing for potential risk management on the downside using this as an indicator for market progression.
See HERE for full charting history.
The questions I wanted to answer through this analysis are:
* How is the BTCUSD market/price action changing as it matures
* Market forces triggering Bull extensions to Bear retracement
* What was the performance of each bull run in relation to the previous
* How long does the BTCUSD price take to move from Bull to Bear and vice versa
* What correlations and thesis may we see and conclude on (if any)
| Breaking The Chart Down |
1) Indicates the Bull to Bear Cycle ( BBC ) start date - 14-09-17
2) Indicates the predicted BBC end date based on the average cycle length - 06-01-18
3) Indicates the true BBC completion date - 16-01-18
From the above, I have established the BBC can potentially be used as a market risk indicator, where the longer it extends past the average cycle timeframe, the riskier it is to take up large positions.
| Conclusion |
With the 100d BBC completed, it’s now time to evaluate whether there will be a true bear market moving past the 100d MA, or if the price action will take a breather, tracking the 100d MA support, and then head for new all time highs as it has done previously.
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