Bitcoin: Bull Market Support Band

hey everyone and thanks for jumping back into the cryptoverse today we're going to talk about Bitcoin and we're going to be providing an update to the bull market support band if you guys like the content make sure you subscribe to the channel give the video a thumbs up and also check out into the cryptoverse premium at into the cryptoverse.com let's go ahead and jump in so I know it has been about a week since we did a video on price action but I was in Miami and while I did make one video while I was there I wanted to spend the rest of the time meeting people just networking in general and and that was sort of the goal but now that I'm back and and mostly recovered um I don't know how some people do like you know 10 conferences a year but now that I'm back let's try to get back into this stuff so Bitcoin right now is at 26.1 right 26 100 so uh the bull market support band is again it consists of the 20 week S command the 21 week EMA and right now that more or less ranges from around twenty five thousand five thirty four to twenty five thousand six thirty six so basically you think about it 25.5 to 25.6 it's a pretty tight range and so what I want to do is I want to make comparisons to 2019 also to 2015 kind of see what's what and who's who in terms of some of this momentum that we've been um that we've been riding for a while so right now we're only just above the bull market support bin right just above it and we've talked about you know really since April the idea of us fading back down into it right we've talked about this for for months we even talked about the summer law right the idea that look in in mid-april we put out a video talking about hey like things could get boring for a while and and sometimes we sort of just fade this into the summer time in 2019 remember it lasted until June um but a Counterpoint to that is that the having this time should come about know a month or so sooner so you could argue that we're um a month further along but what I want to do is look at some of this momentum stuff but also compare to other assets and other say like indices right so the first thing I want to do is is actually do a comparison so look at Bitcoin it's still above the bull market sport band right is it not you can zoom in we're technically above it right now right and being technically correct is the best way to be correct good chance we're gonna test it right really good chance we're going to test it we might in fact fall below it I've said before the pre-halving years we typically spend about half the year above it or I haven't said that I've said half the year we go up half the year we go down the implication is that you'd spend about half the year above it and half the year below it right you you sort of wreck both sides get everyone sufficiently wrecked right that's the general idea now again in 2019 we had another push-up in in June in 2015 we were not nearly that fortunate and and we more or less just sort of hung around the lows uh for most of the Year where we only rallied about 80 above when you look in when you look in 2015 from sort of a 30 000 fit View certainly just does look like a sideways sideways here no one questions that right most people look at this and say well it's sideways you know sideways here but remember I mean this was still you know an 80 rally off the low right it was still a significant rally it just looks sideways when you compare to what came after it right but if you were to zoom in over here if if this is all you saw right if you just saw this rally up like that still was a very significant rally by Bitcoin and um and we still had you know we still faded it here and then we went up again even even up to this point a little bit higher and then still dropped another 48 49 percent and this drop didn't occur until sort of the third quarter of the of the prehabbing year just something to consider right so with that in mind take a close look at this because we've talked a lot about liquidity leaving the altcoin market and going to the Blue Chips now yeah Bitcoin you have eth right those are the only Blue Chips in my opinion alts lead to eth and a Bitcoin theoretically ethereum beats bleeds to bitcoin as well during this phase uh although it's not it's not doing it as quickly but it still is technically putting in lower highs we'll talk about that too but look at Bitcoin USD with respect to the 20 week SMA it's above it right it's above it now look at total which is the entire Market we're below it okay so what does that mean Bitcoins above it total which includes everything is below it so the entire asset class is starting to show some weakness although at this point we haven't added weekly close below it all right now here's where it gets really interesting right Bitcoins above it total slightly below it not a weekly close yet total two which excludes Bitcoin but includes everything else right including eth already had a weekly close below it last week okay so Bitcoin still above total slightly below no weekly close yet total two excluding Bitcoin a weekly close below last week and now potentially a second week in a row what do you think total three looks like which excludes both both Blue Chips right excluding both Bitcoin and ethereum what do you think that looks like total two already had a weekly close and now we're in week number two of potentially putting in another close below it total three already two weekly closes below the 20 week estimate and now potentially in the third week so what does this show you is happening right what does this show you well we talked about right the altcoin market is highly illiquid and people are flocking to the relative safety of the boot ships that sends the dominance of Bitcoin higher does it not right look at this Bitcoin dominance it's still well above the bull market sport band right I mean you know you have Bitcoin USD which is is about to test it the dominance is so so far above it it's got plenty of wiggle room plenty this is still trending High I mean look yeah locally it's it's trending down right and everyone's losing their Collective minds but the other way you look at it is you say well it's kind of maybe holding the support at where it previously kind of held resistance and it still is trending higher look at like you know I was going to work in the dominance of this video right look out monthly candles on the dominance look at this look you have two green and a red two green and red and if you if you do the High kanashi I mean this is a very bullish Trend I mean these are large candle bodies over Shadows no no under Shadows or if they are they're very small so again right Bitcoin USD in an uptrend right and an uptrend um and recently it's starting to fade now what I want to do is I want to compare to 2019. because if you look at these these candles we talked about the idea of a summer lull right where the the price action sort of Fades Fades off look at this we're down what 11 this month okay 11 but hi kanashi probably worthwhile to look at this phase right you had four candles up and the fifth candle started to fade and the candle body was a lower high right compared to this one so you know you have we're in our fifth candle now right so you have one two three four trended higher the fifth one faded right one two three four are turned it higher the fifth one faded and then this is what we talked about we've talked about this idea of of sort of fading for a good portion of the year just like we did in 2019 again you know could there be another push higher maybe right but there are some momentum indicators that are starting to to be a little bit weak one of them is if you take a look at the weekly so let's look at weekly candles we've already closed below the 10 week right now you might say well Ben no one cares about the 10 week guys to make and you might be right but I mean the reality is in 2019 once we had a weekly close below that was all she wrote I mean the the high was in for the year once we had a weekly close below the 10-week moving average after that initial 2019 impulse once we have weekly close below I mean we rallied back up a little bit put in a lower high but again it was it was in fact just a lower high so closable assembly so have we close below the 10 week here you can see we avoided it in March this one opened about below the 10 week but it still closed above it we're back below the Tim wake right we're below it something to consider also to consider is the 100 day right take a look at the 100 day so in 2019 what happened with the 100 day right we rallied for a while right and then once we fell below the 100 day technically we kind of pushed back above it at some point it was a lower high and we just faded and I mean you can see right now that we we did have a daily close around it over here but it's more or less held the line right now we just had a daily close below the the 100 day right uh pretty clearly too right it's not just sort of like right on the line but a pretty clear close both of the 100-day SMA and so I mean there are some moments some indicators that are sort of fading here okay so again I mean like you know we've talked about this before and it's going on in tech stocks too right the altcoin market bleeds to eth and Bitcoin theoretically eat the bleeds to bitcoin as well the dominance goes up and it sends you the Bitcoin USD valuation higher at the expense of the altcoin market liquidity okay at some point the altcoin market liquidity can no longer sustain the Bitcoin price right and then when Bitcoin rolls back over which again I mean like you might say well what if it doesn't well I mean it already has some degree it's already dropped five thousand dollars now it doesn't mean it's gonna have to keep going down but the idea is that as Bitcoin rolls over the altcoin market gets even more wrecked is that not what's going on right is it not hey you look at if you look at Bitcoin USD with respect to the bullmark support pan it's above it total two excluding Bitcoin but including eth is below it total three below it where's eth it's still above it right so it's sort of doing what bitcoin's doing right now right it's a blue chip right I've said before I think I think eats is a blue chip I still think it bleeds back to bitcoin here in this phase but technically speaking uh based on well maybe not technically but in my opinion it's a blue chip um so we essentially have this Dynamic where this liquidity from the lower risk or sorry from the lower liquidity assets are are seeking out the relative safety of the higher liquid assets right because in in times of economic uncertainty which I mean I guess times are always uncertain but in times like this where there's there's plenty of macro stuff to talk about inverted yield curve High inflation a more hawkish fed than we've seen in 40 years people are going to seek out the relative safety of the Blue Chips within that asset class right now a blue chip to you might be different than a blue chip to me and you know if you're in one market you you know people that are not in crypto with sort of scoff at the idea of calling Bitcoin a blue chip but it's all about within the asset class that you're interested in what is the Blue Chip considered right and in crypto it's it's Bitcoin and in my opinion ethereum although there would be a lot of people that would say ethereum is not I would say Bitcoin and eth are are in fact the Blue Chips of the cryptiverse I mean you know the other stuff sort of comes in comes and goes but that's my opinion um and the ought market right I mean did it ever stand a chance I mean it was closing below the 20-week SMA at the beginning of May right when when Bitcoin was still you know back up here like 29k so look at this look at it a different way Bitcoin USD is it would have to drop 25 to reach its March low 25 percent it's a lot right can easily happen right but it's it's it's 25 percent and how far would total three have to drop to reach to reach it five percent right so that's why we talk about at length right like what's you know the opportunity cost in the altcoin market is just so high because most everything is the idea uh is that they they sort of just bleed back to bitcoin so um it's it's interesting right I mean you know and then you have this you have this example of like well what if Bitcoin USD go let's go through a couple of scenarios right scenario one right is is is we as we hold the line right so if if Bitcoin holds the 20 week SMA and bounces then what happened when Bitcoin bounced over here the dominance went up a lot right so we saw the dominance go from uh you know I mean if we just over like don't take my word for it right don't trust verify um if we add the Bitcoin dominance over here you know when we sort of held the line at the 20 week back in March what happened the dominant shot up right so If We Hold It Again the dominance would likely go up a lot so that's scenario one what's scenario two we don't hold it right and and we we fall below it and what I what do you think happens in that environment well history shows that normally when we get that Weekly close below the 20 week the altcoin market bleeds profusely against Bitcoin think about what happened once Bitcoin had these weekly closes back over here in December it was right here when we talked about look we had a weekly close below it's typically a smart idea to to get out of the altcoin market right especially when it has is it has it shows the inability to get back above it right and and you can see throughout all of December we tried you know and I was open to the idea but it didn't happen and then we got rejected and then we talked about look all coins are too risky right in q1 all coins are far too risky because if if this if this thing continues if this bear Market continues to take to sort of take hold the altcoin market is just simply going to go down against Bitcoin for what 18 to 24 months that's more or less what's happened okay now in the prehabbing year you would generally expect generally speaking half up half down generally right I mean look you're don't take it to the bank they're not cashing it in but look I mean look at 2019 year-to-date Roi um you know someone was talking about how how bitcoin's been stronger this year than in 20 2019 I don't think that's the case I mean if Bitcoin had followed its 2019 path it'd already be at like you know much higher than where it is right now in fact it arguably is is following a more tempered version of it uh more say like an average of of 2015 and 2019 and even then I mean maybe that's too optimistic right I don't know uh but again what I've said many times right I've said this many many times if Bitcoin is going to push higher this year I think it needs to do so in the first half of the Year okay I think the latter half is mostly going to be reserved for um fading fading whatever these moves are and we could have already started that fade you know it doesn't have to follow what it did in 2019 I I think it's sort of a common misconception people say it has gonna it's gonna have to follow it but look we have two prehabbing years to really compare to you have 2029 you have we are in 2023 right now we compare to 2019 you can also compare to 2015 which I mean it was pretty hum drum during the time right I mean no one really cared um so but but in this other sense right if you look at the monthly returns in the pre-halving years right like 2019 and 2015 just look at the chart you typically spend about half the months going up half the months going down and so far we've done four green months and one red month although May is not over with yet there's a chance there's a chance that it ends up being green who am I to say that Bitcoin can't rally this to to turn the screen but so far it's been four green therefore for the rest of the year I'd probably expect you know two to three more green months Max and likely going to see some red months you know more red months than green months from here until the end of the year is my guess this should not come as news we've talked about this literally since January that we should have about six green six red it could be five and seven or seven and five um but that would be my general expectation for the duration of this year could something else happen sure right I'm just going based on what the data set what the data shows what's historically happened in the pre-halving year and what normally happens in the prehabbing year is everyone gets excited because we get a rally and everyone calls for new highs and then it fades and and then everyone's like well you know what's going on we have a way of getting ahead of ourselves and one issue that I we've talked about before is is we have this we have this sort of these meme coin rallies that can often happen in the prehabbing year and and Bitcoin has a way of sort of you know of punishing this and um and by Bitcoin sort of fading a move the altcoin market you know can significantly get hit and that liquidity you know people just get so sick and tired of it and then they finally just sort of go back to to bitcoin and then by the time we get to the having Year everyone you know mostly everyone has their Maxi hat on by that point because they just got wrecked in the altcoin market for two years straight and then Bitcoin goes on the real Bull Run that's historically what's happened and it normally takes two years after the peak for people to finally get the memo to say hey like the meme coin Market doesn't lead the crypto bars right Bitcoin leads and if Bitcoin sniffs out at some point that too much liquidity is flowing into into these you know Meme coins that provide no utility it will punish them right it will and that's what it historically has done the meme coins that rally back over here in 2019 my guarantee most of them don't have most you'd have no idea what they even are today why you don't have any reason to they basically all went to zero so who cares Okay so now that bitcoin's sort of falling in here to the 20-week SMA we talked about okay well if it holds the dominance should go up if we don't hold it the dominant should go up well why why would that be the case what what proof is there that the dominance would go up if we don't hold it you know what proof is there is there any proof well I would say this historically if you look at and maybe you know comparing to see ethereum is is probably the most uh prudent prudent thing to do I mean you can see that ethereum has just been putting in a series of lower highs I mean and that's just a fact just one lower high after another okay I don't really think this time is going to be any different in fact May often marks a local high for The Ether Bitcoin pair I mean look at where the ether Bitcoin pair rallied in in 2022 and look at where that final local high was right it occurred in May go look at at prior you know some of these other other time frames um go look back in in 2018. this local high was in May and I mean this one here this one here was in was in about mid-june so a little bit later right this one was in March and then you had another local height here in May um and and so on and so forth you can find plenty of examples here's here's may as well somewhere right there um before they eat their Bitcoin valuation faded and we can look at it like this where you might have to squint your eyes or we could pull up a table right so here's a table and sorry I wish I could there we go so what this table shows us sorry and let me uh before you guys get bad let me move my video [Music] um so just I would say just pause the video and look at this table for a few minutes okay so what it essentially shows you it it shows you when Bitcoin breaks above the 20-week SMA it's when it breaks below or when it breaks below to when it breaks back above and literally nine out of nine times every single time from weekly close below the 20 week SMA to weekly close above the 20 week estimated by Bitcoin USD the ethereum Bitcoin valuation went down nine out of nine times more or less right I mean there there might you might find some instances where it's basically equal but more or less you have nine out of nine times it worked when it went above the 20 week SMA to closing below ethereum has always outperformed every single time except one time when do you think that was when do you think ethereum underperformed Bitcoin when Bitcoin was above the 20 we custom a right there's been plenty of examples through here where Bitcoin underperforms ethereum when Bitcoin is above its 20 week estimate we're not talking about ethereum I don't care about the 20 week estimate for ethereum I'm saying when Bitcoin was above the 20 its own 20-week SMA until closing back below it ethereum's Bitcoin valuation went up except for one time what time was that glad you asked fail right here 2019. from breakup to breakdown in 2019 the pre-halving year is when is when that actually happened okay the prehabbing year so when did Bitcoin break above at this time let's go take a look right and let's go let's go see what's going on so it broke above it in January of 2023 Jan the week of January 9th now go take a look at at The Ether Bitcoin valuation where was it the week of January 9th it's all the way up here at 075. so again you have an example in the pre-halving year where The Ether Bitcoin valuation underperformed even when Bitcoin USD was above its 20 week estimate right so the prehabbing year should be treated differently than say like the having year or the post having year or whatever right you can see that the ethereum Bitcoin valuation has bled in 2023 just as it did in 2019 when Bitcoin USD broke above its 20-week moving average at least so far thermore if you were to go take a look at monthly returns for the ethereum Bitcoin valuation you would notice that on average the first five months didn't be green but starting in June through the rest of the year on average it tends to be right now not every single year that's occurred but on average right with you know large large standard deviations um it's been red in fact most genes have been read except for two and one of them was only half a percent to the upside you'd have to go back to 2017 to find a significant move by Ether Bitcoin to the upside in June normally it just goes down by double digits or so so going back to the discussion well so you're saying that if Bitcoin holds the line and bounces up like it did in March the dominance goes up and if it doesn't hold the line and and falls back below and Fades this rally right like it faded over here and like it faded it over here then the dominance also goes higher why does the dominance go higher because the the all coin Market has nowhere to hide my friends I mean it's already below the 20-week moving average so let's imagine a scenario where Bitcoin bounces but puts in a lower high right so let's imagine a scenario where where Bitcoin uh let's see path so this semester where Bitcoin sort of falls back in and bounces but it just a lower it's just a lower highlight 2019. so you could you could see Bitcoin go back up but total three could go back up and just get rejected by the 20 week right so a bounce off the 20 week estimate for say Bitcoin could just be and a potential lower high could just be the altcoin market retracing back to its bull Mark sport band from underneath it and then just getting rejected and that is how the altcoin market gets so wrecked during this phase the market cycle that's how it happens because the thesis right is that no matter the direction of Bitcoin USD the dominance should go up either way and in the prehabbing year we normally expect half up and half down it's just my general expectations right I mean we always get ahead of ourselves in the prehabbing year but that is uh historically historically at some point it fades now are we fading it now potentially could it you know could we fade it you know could it get another balance and then fate it's possible but there are some of these momentum indicators if you look at some of the moving averages and whatnot um they are starting to fade I mean there's another indicator I don't even know what it looks like right but let's go check out I know some people like the uh the macd I mean it actually okay look it just turned red on the weekly so what happened in 2019 when it turned red I don't even know because I don't really follow this indicator I'm guessing it turned you know once it turned red that was it right you can see right here in July turned red and it meant the highs were in so there is a chance here right this this move is just being faded and the altcoin market gets wrecked and it's the all coin Market's already near the March low despite the fact that Bitcoin is not so if Bitcoin were to go to the March low where do you think that puts the altcoin market You could argue that Bitcoin were tracing back to its March low at some point later this year could put the altcoin market at new lows or at least at the prior lows back in December which are still well below the March lows so there's a lot going on right now um and note too that the dollar is You know despite all the funds so far it's back above is 20 week SMA and and sort of held its own um prior low potentially double Bottom now this could just be a lower high we'll have to wait and see but uh there's been a lot of fun on on the dollar and and so far it's still holding pretty strong so just to recap right Bitcoin USD falling into the bullmark sport band total slightly below it but not a weekly close yet total two already below it with one weekly close below it total three already two weekly closes below it liquidity flowing from higher risk assets to lower risk assets for a certain period of time the higher risk assets can help support the USD evaluations of the lower risk assets because that liquidity is going back to those blue chips but at some point when the Blue Chips were all over because there's no longer enough liquidity from the from the altcoin market to sustain them then the Auckland Market gets even more wrecked because they already have so little liquidity because so many people already converted them to the Blue Chips so that's how the altcoin market gets wrecked no matter the direction of Bitcoin USD and it's also why the Bitcoin dominance should go higher if you guys like the content make sure you subscribe to the channel give the video a thumbs up and again check out into the cryptoverse premium at into the cryptiverse.com I'll see you guys next time bye

Channel: Benjamin Cowen

Views: 59,346

Keywords: Cryptocurrency, Bitcoin, BTC, XBT, Crypto, Finance, Money, Investing, Blockchain, Wealth, Invest, Bull Market, Bear Market, Bubble, Speculative Bubble, Accumulation, Correction, Crash, Bulls, Bears, Mania, Fear, Greed, FUD, FOMO, Ethereum, ETH, Ether, Altcoins, Alts, Market, Markets

Id: 3qn09E0WUvI

Length: 28min 0sec (1680 seconds)

Published: Wed May 24 2023