Is the MARKET in Crisis?

 Hi everyone, welcome to a Monday Rapid Fire. Well, the daily looks suspect, the weekly closed horrible, but the monthly still looks good. Which one do we pay attention to? Let’s dive into the charts because I’m going to show you that. I’m also going to overlay some cycle thoughts that I did post into the discords if you weren’t aware.

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So let’s look at the daily here. Yeah, it looks top heavy, it looks wheat, and if I’m looking at a sort of a longer term,  I guess, thesis here, it could be that the market makers and derivatives traders and just generally the market in general,  It would be very poetic if we came back and did a full retracement of the ETF launch.

So that would come all the way back down here. Yes, Black Monday hit about, you know, 48, 000. But imagine if this was the final extension into that ETF retracement area of about 44, 000, 45, 000. Now that could make sense, but that is a big drop. That’s a significant drop from here. It would be similar, kind of like a 2019 style drop away.

Wanted to put that on your radar. I do think though, as long as we are holding this higher low structure, and this is really, really important for me here Black Monday, then we have the higher low here on this horizontal, which is also a keyfib and archie level. As long as we’re holding above here, we’re fine.

And anything below that is just kind of fantasizing on the, the bare opium.  Then we’re going to do these massive drops downwards. You can look at volume profiles as well. I want to see some strong volume come in at this point here. If we dip into this area, I want to see it strongly bought up and then it’s kind of like a bear trap that we’re retracing.

Kind of like a double tap on that third support. My personal view is of the overall market. It does look top heavy. It doesn’t look that flash on the daily. But I do think 44, 45, 000 isn’t going to happen. That’s just me. I think 50, 000 kind of was the low here. I think we could absolutely get down to 54, 000, 53, 000.

That’s again a core level  as well for some other reasons. But  yeah, just generally that would be an extreme move. So, again, we have to play it level by level to see where it sits, but we want to see bulbs sort of kicking here and halt. Now, if I just pop on over to the weekly, I just want to explain to you why it didn’t look flash to me, so I’ll just zoom it again.

Yeah, and that’s why I think 53, 54, 000 is probably the extent of this move, based on the 50 week moving average just sitting there. Nicely to, you know, we’d feel out this big wick going down, but we’d hit off it and hopefully bounce higher. But broadly we’re in this, I guess, downward, descending, broadening channel, whatever you like to call it.

But it’s fairly easy to track. And we’re just waiting for a decisive move in either direction. The top heaviness of the market would suggest we go, you know, a little bit lower. But again, I think when everything looks so bad, it can actually be bullish. So have that in the back of your mind. But if we’re looking here, I hated this candle.

It just closed. This huge bearish engulfing candle completely covered this last big green candle, which looks fantastic. Close above the 10 EMA, 20 SMA. Looks really bullish. For continuation, we’re going to blast upside. Nah, the market had other ideas too. That’s what we mean when derivatives and market makers are going to chop everyone up in the volatility to the up and the downside.

It’s kind of like, everything looks bullish as hell, great close, but the next candle completely wipes all of it out and gets everyone scared and shorting the bottom. That’s kind of where we’re at at the moment. So RSI still in consolidation mode. And I think if this drops through the floor here, it’s going to that 53, 000 level and that will cap it.

That would be the extent of it. I could be wrong, but that’s just a gut feel on that. The monthly looks really good in the sense that it’s still above the 10 EMA. That is my bellwether for, I guess, bull market support. We just want to keep closing above that. This month is going to be fought with catalysts of volatility.

So, I’m more inclined that we’re going to see more chop. You know, we’ve got the rate decision coming towards the back end of the month, I think on the 19th. We’ve also got the presidential election debate which is coming up in the next, you know, week or so. Lots in between. Unemployment rates, you know, all this.

September season late seasonality wise. It’s not a good month for Bitcoin either, but we’ve been in consolidation for five months as well. So more chop isn’t going to matter too much. That brings me to my, I guess, cycle analysis chart on where we are at. So you can very clearly see by the boxes that I’ve put there, part of the timings, how low we’re in each phase.

And this is important here. So 913 days. So it’s 882 days from the 2017 high.  So  882 days in this cycle, it was  913 days from that. We’re going from the second peak, 913 days from that height to the next halving. Now in the prior cycle, we had in the period, post halving 181 days, kind of what I’m going to call an intermediate period.

That’s what I’ve got drawn here as well. So if we adhere to exactly what happened in the last phase, 181 days post halving, we are one month away from going into the 335 days according to this here of, you know, breakout phase. Now I actually am thinking that so October The last three months of the year are going to be pretty explosive, especially if it looks like Trump’s going to win.

But over here, 244 days was the 2017 cycle in terms of the breakout. So I’m measuring this as well from when it’s broken out of the, I guess the old highs. Now we did make an early all time high over here, but we’re in a consolidation underneath that crucial sort of all time high breakout move. So that’s what I’m looking at there.

But again, I think we’re going to accelerate and get to where we want to go pretty fast.  According to this, if we do the exact same as last cycle, we will have until September 1st next year for the end of the bull market. I don’t know if that’s going to be the case. I reckon we might see a sell and buy and go away type sort of thing at the bull market just peter out.

Based on economic recessionary issues or maybe about the large catalyst. And then we move into a new sort of 913 days, give or take, or 882 sideways, you know, halving style or situation. The halving is very interesting. You could start to think that, you know, this time is different. We might have a different catalyst, super cycle, all that.

It’s still a significant pull just in terms of how investor behavior interacts. So I don’t know, I don’t think we shake it this cycle. Unless, yes, they add it as the strategic stockpile to the U. S. government,  they start buying more, other governments do the same. That could create a bit of a feedback loop which doesn’t allow Bitcoin to come back and do these significant sort of multi year sideways retracements.

This could be the last cycle, I don’t know.  We’re just going to have to again, play it by ear. But if you zoom out and look at it like this, we are absolutely on track. We’re kind of doing exactly what we should be doing. Albeit in the last phase, we were actually starting a far quicker upwards move.

Right now we’re in consolidation, which makes sense because we made an early all time high versus the last few cycles where we didn’t have an all time high prior to the halving. So  we’re in a more extended period of consolidation here, which is great. We can have that expansive move afterwards.  Now I just wanted to point this out from Checkmate who looks at on chain, he’s an absolute expert.

We’ll be doing a webinar with him in the next few months, hopefully you know, fingers crossed. But here he just points out that the class of 2024 are underwater. So what’s really interesting is when this launched, when 2024 started was when the ETFs launched. And so everyone essentially who bought from that start of the year to now is underwater.

So they are kind of like a short term holder cost basis. Whenever we duck beneath it, may cause an element of panic. It’s selling on the market. We are seeing prolonged selling on this market from somewhere. It could be a multitude of things, Mt Gox, Miters, you know, all that. Once this is over though, we’re going to be in a very healthy position.

But I wanted to show you this the 2023 cost base is around 41, 050. So there’s a bit of confluence there for the 44, 000, 42, 000 level to be hit potentially based on what I shared with the ETFs and, and all that. But if we’re looking at the short term holder cost basis. You know, we’re kind of at the panic stations now you know, the holders that bought the last few years don’t give a crap about the price right now.

They just do not, they’re not going to sell for anything. They’re waiting for six digits and higher. But right now, it’s kind of the ETF buyers, are they going to kind of panic sell a little bit here? I don’t think so. We’re seeing a few outflows now, but it’s, it’s kind of a longer term game. Also on the extreme of where I think the floor is on this The market, if we do drop through, you know, 50k, it’s 43, 000.

So again, the confluence is there for that lower mid 40k region. This is the electricity cost of how much it costs to mine Bitcoin. So production cost is one thing kind of factors in a lot of different inputs, but the electricity cost of that 43, 500. That would be an extreme move and we’ve only hit it in COVID.

We’ve rarely hit it in fact, I don’t think we’ve hit it really once post, post halving in a bull market. We’ve never come back and hit it. So that’s my flaw. That is my extreme move. You know, you throw absolutely everything in it, but seriously, if we get towards 50 chain debt, I’ll be deploying very, very heavily because I think that’s you know, way, way lower than where I think the market is valued and where we’re heading.

You just have to have that longer term focus, you guys. This Monday Market Update is a little bit longer. I know with the Masterminds, I went through a bunch of different charts, including Solana, Eth, where I think it all sits at the moment. But unfortunately at the moment, altcoins are just taking an absolute kating again.

But I don’t think they have too much lower to go. Bitcoin goes to 50k, 45k. Yeah, they’re going to drop, you know, a few percent, maybe 5, 10, 20 percent in that range, depending on what they are. But we saw that in Black Monday. So really what we’re looking for here is relative strength. We’re looking for a higher low, I guess, from the Black Monday.

And each chart will be different when you look at that. Some look identical, but some aren’t. Some of the bigger ones aren’t. And I just want you to focus on what you’re owning, the strategy, the longer term focus, and not being shaken out right at the end. Or we actually have the market reverse and turn on us.

But it’s gonna take a little bit of time, obviously. But September was always gonna be a bit of a volatile month. So we just have to accept it and focus on what’s coming afterwards. So guys, hope you have a wonderful day. We’ll catch you again for our next episode, which will be Auckland Bible on Wednesday.

Have a great day. See ya. Bye bye.