I Will Continue To Make A Bullish Case For Altcoins
As I've been posting about over the last day or so, altcoins have broken down out of their uptrend channel. This was a bearish development in the chart, at least in the short term. It would have been a sell signal, as we did drop substantially since the trendline was breached. In doing so, altcoins have not followed the path I was speculating about when I compared Bitcoin's current price action to Summer 2016. I did emphasize that this was ONLY SPECULATION. The fractal has not played out, and as such, I need to look at other possibilities. I will continue to post new market cycle ideas as things develop. Bitcoin dominance has reached a very critical level (the 66.7 zone I keep talking about). Even if Bitcoin continues to drop from here, I don't think the altcoin market could withstand much lower ratios. I would not be surprised to see some alts recover 100-300% on their ratios from here in a very short amount of time, especially given the extreme bearish sentiment right now. I'm looking at XRP and XLM in particular - both of which have started to move up slightly on their ratios since I posted a long setup for them about a week ago. A lot of profit has been taken from Bitcoin whales over the last couple of weeks. Will all of it leave the market entirely, or will some of it go into alts that have retraced nearly their entire pumps from 2017?
Despite mistakenly assuming altcoins would rise earlier, I did perfectly call the Bitcoin top near $13.7K. I also projected the exact movement for the crypto market up towards the $300B valuation and the top of the channel. Let's look at those posts:
The total crypto market cap reached the top of its channel simultaneously with Bitcoin, and has since dropped down towards the bottom of the channel. It should be noted that those squiggles are projections that I drew months ago.
Looking at the above chart, there could be some more downside (towards the 200B area) and it would still look very bullish. Given that the overall market has not broken its bullish trend, we can perhaps assume that further downside for altcoins form here may be limited. In this analysis, I'm speculating on a couple of scenarios. You can see on the left that alts broke out of a bullish channel to the downside in 2017. However, they found support and even though they never reclaimed that steep uptrend, they continued on up and have since never tested those lower levels again. This goes to show you that a breakdown simply means an interruption of the trend, and perhaps some slower growth. That breakdown actually caused a similar valuation haircut (roughly 50% from the peak). I'm just trying to put things in perspective, since many people are probably panicking right now. If we're in the early stages of a broader bull market, we could also see alts break down below the potential neckline I have drawn and retest some nasty lows from December/January. We could still hold the long term uptrend even if that happened. If you zoom out, you'll see that the pink support dates all the way back to the end of 2015. Right now, nothing fundamentally signifies to me that the crypto market will begin a long term bearish trend.
ANYTHING is possible in this market. At any given time, someone could be predicting a new bottom as well as a new all-time high. Only one person will be right. From both sides, there are individuals who will rub it in each other's faces, saying "I told you so," as if it was obvious to them all along, where in reality all they did was make the right move at the right time. I'm seeing this all over social media. As humans, we tend to focus on these people who made "perfect" moves and forget that most people will lose out in the long run. These biases fuel our irrational and destructive feelings of envy, greed, fear, and anger. This is why we've created the market in the first place. Crypto is an offshoot of the extreme growth and wealth our society has amassed for itself. I think we've reached a plateau in terms of our population and technological innovation, so we created a whole new market based off speculative money just simply out of boredom. Whether or not this market becomes a whole new asset class for years to come....we shall see. I'm prepared to be wrong. Are you?
This is not financial advice.
-Victor Cobra
Despite mistakenly assuming altcoins would rise earlier, I did perfectly call the Bitcoin top near $13.7K. I also projected the exact movement for the crypto market up towards the $300B valuation and the top of the channel. Let's look at those posts:
The total crypto market cap reached the top of its channel simultaneously with Bitcoin, and has since dropped down towards the bottom of the channel. It should be noted that those squiggles are projections that I drew months ago.
Looking at the above chart, there could be some more downside (towards the 200B area) and it would still look very bullish. Given that the overall market has not broken its bullish trend, we can perhaps assume that further downside for altcoins form here may be limited. In this analysis, I'm speculating on a couple of scenarios. You can see on the left that alts broke out of a bullish channel to the downside in 2017. However, they found support and even though they never reclaimed that steep uptrend, they continued on up and have since never tested those lower levels again. This goes to show you that a breakdown simply means an interruption of the trend, and perhaps some slower growth. That breakdown actually caused a similar valuation haircut (roughly 50% from the peak). I'm just trying to put things in perspective, since many people are probably panicking right now. If we're in the early stages of a broader bull market, we could also see alts break down below the potential neckline I have drawn and retest some nasty lows from December/January. We could still hold the long term uptrend even if that happened. If you zoom out, you'll see that the pink support dates all the way back to the end of 2015. Right now, nothing fundamentally signifies to me that the crypto market will begin a long term bearish trend.
ANYTHING is possible in this market. At any given time, someone could be predicting a new bottom as well as a new all-time high. Only one person will be right. From both sides, there are individuals who will rub it in each other's faces, saying "I told you so," as if it was obvious to them all along, where in reality all they did was make the right move at the right time. I'm seeing this all over social media. As humans, we tend to focus on these people who made "perfect" moves and forget that most people will lose out in the long run. These biases fuel our irrational and destructive feelings of envy, greed, fear, and anger. This is why we've created the market in the first place. Crypto is an offshoot of the extreme growth and wealth our society has amassed for itself. I think we've reached a plateau in terms of our population and technological innovation, so we created a whole new market based off speculative money just simply out of boredom. Whether or not this market becomes a whole new asset class for years to come....we shall see. I'm prepared to be wrong. Are you?
This is not financial advice.
-Victor Cobra
评论:
Some nice rebounds here. Altcoins will need to break out of this descending broadening wedge to confirm any sort of reversal back to the upside.
