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 check out into the cryptographers premium at into the cryptoverse.com let's go ahead and jump in so it is somewhat timely to provide somewhat frequent updates on the bull market sport band considering that we still find ourselves above it and so as of this week the 20-week SMA is coming in right around 26 075 and the 21 week EMA is at around 25 8.99 so more or less the bull market support band is at 26k so as long as Bitcoin holds above 26k then technically speaking you can say that the 20 week estimate is in fact holding as support all right so one of the things that we mentioned last week and I wanted to provide some an updated video on it are a lot of the different Milestones right there's more there's other moving averages there's other trends that you can look at to sort of better identify what are some of the obstacles that Bitcoin would ultimately need to overcome if you're not familiar with the bull market support band there's this idea that we've spoken about on the channel for years and it's the idea that holding the bull market support band as support can can provide renewed strength to bitcoin locally okay it was in fact in 2020 when we held it for six weeks straight that we said if we hold it it's going to be a good thing and why did we say that right well let's be clear right when we held it I was not thinking that it was going to immediately shoot to new highs okay I mean just to be you know just be clear but what you'll notice is that in 2017 we sort of held it for a couple months would move up we would then hold it for another couple months we would move up and then so on and so forth and we just simply continued to move higher until ultimately it broke and then the bear Market began okay last cycle we held it out of support and then we just basically took the elevator up to the high it there wasn't really much much in the way of of testing it and holding it as support now this time right we held it as resistance several times resistance here uh we even got rejected here if you guys remember back in October November we put out a video saying you know a lot of people get excited about the June low and they call it the bottom and it's not usually the bottom right and same thing happened in 2018 as well a lot of people thought this was the bottom me included in 2018 and and it wasn't you know we ultimately put in a new low and one of the things that I I think is worthwhile to mention here is that there I mean there are a lot of moving averages that we could take a look at and there's different periods that we can compare to one of the things that we mentioned last week is the 10-week moving average okay I want to follow up on that a little bit if I can figure out which one it was it must be this one down here maybe it's um I might have to add it there it is so this is the the 10 week estimate and the 20 week estimate so the reason why we're looking at this is because there's a lot of times in history where Bitcoin sort of it it rallies above the 20 week for a while it then comes back back below the 10 week and then it's sort of between the 10 week and the 20 week okay and that's where we find ourselves right now now the 10-week out to May is at around 28 200. specifically 28 176 but it's around 28.2 K so we're just sitting below that but we're above the bull market support band right so sort of between a rock and a hard place and I think the thing to look at is when in history has this happened when in history have we found ourselves between these two moving averages well most recently it happened back in March now this though was a very quick test of the 20 week estimate it's not like what we saw in 2017 where you had like two month tests of it or in 2020 where we had a month and a half test of it right this was just a a brief Wick we had the not QE QE and and then you know Bitcoin exploded back up to the upside so if you don't look at that one which again I mean there's there could be some Merit to looking at it you go back and you look at 2021 right so we have that period in 2021 let me actually highlight this in a in a different way but we'll draw circles so you have this period here in 2021 where we went below the 10 week we had a weekly close below the 20 to the 10 week we held the line and then we ended up pushing higher okay we we followed that right we said you know we said we should push to new highs after after holding this and we did I mean we're all so much closer to those Highs at the time um unfortunately it wasn't much higher than the prior high but technically it was a new high there's another period here in 2020 where you can see that we dropped below the 10 week we spent six weeks between the 10 week and the 20 week and then ultimately it held out of support and we moved higher if you go back again uh further further back you'll see there's a period here I don't really know if we should spend a whole lot of time looking at this one because this was the pandemic drop and everything just sort of plummeted uh out of nowhere um you can I mean look I get people sometimes a hard time for calling everything a Black Swan I think there's a good a good case to be made that you know something like this was in fact a black swine um mainly because you know in order to see moves as quickly down in the stock market as we saw it has to come out of that field right like if you think about today right there's always something to worry about right we call it we call it climbing the wall of worry there's always something to worry about whether it's um the FED raising rates whether it's in inflation remaining sticky whether it's [Music] um the debt ceiling whether it's probably going to turn into student loan repayment there's always something to worry about but oftentimes it can take something that no one is thinking about to actually cause a major dump I mean you could have Corrections right like if if something happens that that is is is bad enough right you can have a 10 correction you don't even have to have a news headline to have a 10 correction it's just or a 5 or 10 correction it could just be that everything went up so quickly and then now it's time for it to just correct because there's going to be some people are going to sell and it's going to temporarily overweight over override the buying power so you could have five to ten percent corrections but it get like the types of Corrections we saw back when the pandemic hit it normally needs to be some type of Black Swan event that no one's really predicting okay uh it's sort of like how we've mentioned before right like the the debt ceiling getting cleared and TGA having to get refilled that would that would yeah theoretically that would suck liquidity out of the system now that could put headwinds on the market it's probably not going to lead to an immediate capitulation Okay so the other time to think about though is 2019 where you'll see that we dropped below the 10 week so we're sort of between the 10 weekend the 20 week for for quite some time so we're going to take a look at that one as well and we're also going to take a look at at this one in 2020. okay so these are the last two times that it occurred of course you can go back further in history and find other times where it occurred but the last two times that it occurred during market conditions similar to the ones we're in now I suppose you could say 2019 and 2020. now the market conditions of course in 2020 were a lot different than today I mean the FED just printed six trillion dollars um you know interest rates were basically at zero percent and we had people flocking into the space right the social risk was going up now the social was going down but one of the things I want to talk about here in both cases we actually spent a bit of time between those two moving averages right it wasn't just um uh just a week or two but in 2019 you'll notice a a difference in the sense that we had a weekly close below the 10 week we then rallied back above it for a few weeks right and you can see we had two weekly closes back above it before It ultimately faded back down this ended up being a a lower high okay this ended up being a lower high and we got back below the 10 week we eventually got to the 20-week SMA and then we you know you can see we we weren't unable to get back above the 10 week in any sustained way back in August and September and then by the time the end of September came we had that 20 move down right you know the Bulls could no longer hold the line and they had been fighting to hold the line for a long time but unfortunately they were not able to do it and then we we sort of entered into another um sort of like mini bear Market it wasn't like a a 2018 bear Market it wasn't nearly as bad but it was still a period where sentiment in the space pretty quickly turned bad and no one was really interested in crypto for the next like eight or nine months or so and then things started uh to turn back up in the summer 2020 I'm sure a lot of you guys will remember the D5 summer of 2020 which was very exciting now um where are we right now so again in this period where we just had two weekly closes below the ten week Bitcoins trying to get above it right now so far it has been able to unable to do so now I imagine this week is going to be a significant week with the with the vote on the debt ceiling uh and all that stuff or you know the vote to raise the debt ceiling and all that stuff in Congress so I do imagine there will be a lot of volatility uh in both directions so do be aware that you probably will see the significant amount of volatility this week again in 2019 we did rally above it but ultimately it was faded in 2020 we got above it and it wasn't faded so you're probably wondering right like well how do you navigate something like this you don't know what's going to happen well I I mean I don't know what will happen I don't know if it will hold a support or not that's the honest truth I have no idea uh if it will hold or not the way that I've hedged myself for quite a long time is my crypto portfolio is just simply Bitcoin heavy and I'm also have a a sizable cash position in case we do see a correction that is the way I think that that's my non-financial investor that's the way I am navigating these markets um because and you might wonder why well the reason is because uh the dominance I think should go higher right and I don't find a compelling reason to to look at the altcoin market as something that's worth the risk now that doesn't mean the altcoin market won't go up on their USD pairs if Bitcoin does it's just that we've seen time and time again that when Bitcoin does move up in 2023 what happens the dominance goes with it so if the altcoin market is to move up in any type of sustained way then arguably it would have to come on the back of Bitcoin moving up first and or with it and so the risk that you want to take on and you know that I've been taking on anyways has been limited to to um to bitcoin right and if Bitcoin corrects then then you have a cash position right so I mean that's sort of how I navigate it mainly because I I think and I thought for a long time that the altcoin market is just systematically bleeding back to bitcoin throughout this phase so what I'm looking for here is is do we get back above the 10 week but more specifically you know do we take out this High okay the 31k I've mentioned several times this year that you know that we likely would see about half up and half down in terms of monthly candles so far we've had four green candles so you know you could have two or three more green candles this year and it still wouldn't necessarily negate that hypothesis of about half up half down just like we had in 2019 just like we had in 2015. the other thing that I think is worthwhile to take a look at are some of the daily moving averages okay because this is something that we also covered in the video last week and I'd like to uh touch base on it again as well we had daily closes below the 100 day okay now we also had daily closes below this 100 day SMA in 2019 as well and also in 2020 okay so again right like it depends on what your bias is if you're a bull you're probably going to say well it's more similar to this period where you had a daily close below it we got back above and then ultimately we just rallied on up if you're a bear you're probably going to say well what about this right what about this period where we had a daily close below the uh the 100-day moving average and then ultimately you'll see that in both cases in both cases we had a daily close below and then we rallied back up in both cases and in both cases after rallying back up after going below the 100 day we went below it again the difference between 2019 and 2020 was that in 2019 we once we got back below it we just faded it from there on out for I mean we had some Wicks back above it and then of course by by the time we got into the having year we got back above it and maybe this would have been sustained had the pandemic not have happened right could have would or should I mean who knows but at the end of the day in 2019 this faded after getting back above it in 2020 we got above it we came back down below it and then we popped back above it held it out of support and then blast it off this process here took about six weeks if you take from daily close below the 100 day until we we really held it out of support in a sustained way and then moved up higher as about 36 days in this case here from when we got below it until when we fell below it was about 21 days it's about three weeks so you have a period of you know three three to six three to six weeks somewhere in that period where that's what essentially happened the last time we were looking at a at a case where we fell below the 100 day got back above and then in one case in 2019 we faded it in 2020 we rallied okay now again it depends on if you're a bull or a bear what you're going to put more weight in I mean you know I will say Bitcoin Bitcoin has been strong this year it has and it's been a lot stronger than the altcoin market but there are some similarity I mean I think you could find some similarities in both both scenarios for instance one of the similarities in 2019 compared to today so if you look at if you look at this period here in 2019 compared to um to where we are today one of the similarities is we had an inverted yield curve right so if you go back and and look at um let's go take a look here at the macro stuff so let's go look at the yield curve actually we're going to look at Treasure yield spreads you'll see again in in 2019 right we had an inverted yield curve in August and September and I can I can overlay uh bitcoin's price if that would make make more sense right so if we sort of zoom in here 2019 it was an inverted yield curve just like we were in today this one's a lot more significant today but it's still there right an inverted yield curve it did not hold as support in 2020 when it did hold out of support was not an inverted deal curve right we had a lot of you know this was actually going higher so that's one similarity between today and 2019 and you'll notice here if you zoom in that that Bitcoin just had a daily close below the 100 day and then it popped back above and then if you go back again remember to these two scenarios in both cases we went below it and popped back above and then went below it again so if that's any indication then there could be a you know some and not too not that it's not too distant future that we go back below it and and and then we see what's what who's who right then we figure out okay is this a sustained move or is it going to fade like 2019 now to you know to sort of throw a ball into the Bulls as well I mean one of the similarities You could argue about uh between today and 2020 is that there is a lot more money out there I mean like there's a lot of money printed okay there's a lot of money printed over here that money is still theoretically in circulation I mean the money supply has been going down I mean if you go take a look at at M2 if you look at M2 and you look and say like the year-over-year percentage change I mean and if you adjust for inflation it's it negative 9.14 percent right which I mean is not something that commonly occurs there was still a lot of money printed and it's taking a long time for the FED to drain liquidity and I think they're going to try to continue draining it until until they get a handle on things so it doesn't mean that you know the stock market hasn't been able to climb the wall of worry it has been climbing the wall of worry and the FED just continues to raise rates it's almost like a game of chicken who's gonna cave first um so we're in this scenario right we had the daily close below the 100 day we talked about this last week we popped back above it just like 2019 just like 2020 the question is is where do you go from here okay now one of the things we talked about before and I'll mention it again is and I I know people might roll their eyes when I I sort of work in the dominance into every single video but I mean look I I think it's an important metric I think a lot of people have underestimated its importance for a long time and if you roll back the clock you know six months ago when the dominance was at 38 39 a lot of people were calling for it to tank and go to 20 30 and look where it is today right it's just comfortably sitting above 48 and everyone's sort of losing interest in crypto you know um views are down across a lot of YouTube channels and it's not just mine you might say well Ben maybe it's just yours because you're boring you know but even the people who arguably aren't boring um views are going down as well and and so that is is something that I I think we're all having to contend with is people are struggling just to stay interested because the price hasn't really moved in two months you know I mean we were legitimately at the same price March 18th and I mean when you think about it I mean I think a lot of us have been pulling our hair out whether you're a bull or a bear pulling your hair out as to which way this is going to break and it's basically just gone sideways for the last two and a half months so I think it is draining people people are starting to lose interest and they're only going to return once a volatility once volatility returns so again you do have the uh the 100 and the the 100 day moving average here um the other thing that we could take a look at is I believe it was at the uh not the 200-day it was maybe the 50 day no I think it was the 20 day I was looking at earlier so in 2019 you'll see that once we have the daily closed below the 100 day right here we popped back above the 20 day and then we faded back down right now we just popped above the 20 day again right we just popped back above it and another thing that's interesting when you compare these two times is if you look I mean if you look closely right there was a cross here so the 20-day cross below the 100 day after we had these this daily closed below right so you saw the cross below the 20-day cross below the 100 day and during that rally back up and then it faded back in in 2020 the 20-day never actually crossed the 100-day moving average right it never actually crossed it in 2023 it hasn't crossed it yet right I don't know if it's going to you know but this is something that I I think is also worthwhile to keep an eye on is that this 20 day has not actually crossed the 100-day moving average just yet if you were to go back and look at the last 20 days right just to get an idea of what it's going to do um you know we're going to start the the 20-day SMA if we try to get an idea of what direction it's going to go I mean first of all as long as the price is up here you would expect a 20-day to start to curl back up okay it's only if it were to fade back down that you know that the 20 day would actually cross the 100 day um in in the short term now in the long in in sort of like a more medium term time frame if you look back at like a hundred days ago where Bitcoin was 100 days ago you can see that the you know this is sort of looking at a local high so as we start to exclude these data points right we're gonna ex we're basically going to exclude some of these and then replace them with you know some of the ones up here as long as the case I mean the 100-day SMA should continue its General General uptrend okay so that was something I was looking at as well like the 20 day has not crossed the 100 day yet um it it did cross in uh in 20 2019 right you can see that it crossed right here and it kind of just remained flat for a while in 2020 it it never crossed okay and you can see we kind of hugged it for a while but it never crossed right this one hugged it for a while the 20 days stayed above the 100 day this one um back in 2019 we hugged it for a while but it was slightly below it so I think that's something that we should look at um as well the other thing that I want to mention is the dominance right and I want to talk about this very uh concisely if I can as well as I can so one thing to consider here is is that in 2019 we had a series of lower highs right lower high lower high lower high lower high okay in 2020 I mean the market it was completely different market right I mean you know this was sort of a move up we we then we came back down back tested the 20-week SMA uh support it wasn't really a series of lower highs in the same sense I mean I suppose you had a couple here right you had a lower high here you had a lower high here but that was um I mean I guess maybe you call that one one but it was it the the shape of the mark the market structure was of course different in 2020 than than 2019. okay I think we can see that pretty clearly but one of the things that I wanted to mention and just sort of reiterate here is I want to Overlay the dominance of Bitcoin and the reason I talk about this is we've talked about this thesis for a long time okay I've mentioned this I don't know how many times and you know I feel compelled to follow it through until it's either a proven uh inaccurate or or until it proves itself out right there's this idea that the Bitcoin rally lasts until the dominance range the top of the dominance range is broken and I've mentioned this many times right I mean I've mentioned this so much in fact that people have literally sent me messages and and whatnot telling me to stop being so repetitive because I've heard the same thing over and over and over again but I will mention it once again okay because this is It's it could play out like this it doesn't have to but it could and because it could I I do feel compelled to at least talk about it I think it's always good to manage your risk doesn't mean that it has to play out but there are two scenarios where in in recent history where the dominance broke up right where you had significant rallies in the dominance okay and where were those you can see one here in 2018 and one in 2019. now I know what you think you're probably saying well Ben there's no reason to compare it to 2018 right this is a prehabbing year compared to 2019 and we will compare it to 2019. and we'll do that first but we're also going to compare to 2018 as well and I'll I'll explain why but I I do want to at least compare it to 2019 first okay so why compare it why look at the dominance well look closely at when the rally by Bitcoin faded okay so you have Bitcoin over here and then you have the dominance right here okay so the dominance if you remember if you're are in crypto back then uh the dominance essentially had this had this Range High that it hit in in uh I mean you can see it hit several levels right like this was September of 2018 is is kind of that level that it it rallied to okay and what you'll notice is that we sort of had a sorry I messed this up we sort of had a false breakout of the dominance in May right but what happened in May the dominance faded back down the sustained break of the dominance from this Range High did not occur until June now draw the line across when we broke the dominance Range High in a sustained way right that wasn't just immediately faded what did that Mark if you draw the line down it marked the top of the rally okay it marks the top of the rally right I think we can see that pretty clearly okay so you know that marks the spot right it marks a spot right here once the dominance broke its Range High that marked the top of the Bitcoin rally did it not we can see that clear as day but what's interesting and we've talked about this forever right what's interesting is that the dominance continued to go up right so the dominance was at 60 percent at the end of this rally but the dominance continued to go up to 73 percent even after the rally was over okay so there's this idea and I've talked about it before is that the strength can continue until the the Range High on the dominance is broken right so that's if you want to compare it to the prehabbing year of 2019. you can see pretty clearly that once this level was broken in a sustained way it marked the top for the rally now we broke it over here and it did not Mark the top but the dominance faded back down let's go look at 2018. okay let's go look at 2018. very similar thing played out in fact okay so you had you essentially had a very similar thing play out we had this Range High on the dominance you know at around 50 percent it was like 50 51 or so um let me sort of try to get it exact here this is the level right around 50 or so and uh Bitcoin the dominance rally started and at some point during that dominance rally right you can see it it started off slowly just like it did you know just like it did in 2023 right it it started a little slowly and then it picked up steam and what you'll notice is that when when did this rally by Bitcoin USD fade when what marked the local high on it draw a line that's the top of the Bitcoin USD rally right here right let me fix this okay so this is the top of the rally in in Late July of 2018. what do you notice about this rally guess where it corresponded to the local high on bitcoin USD corresponded to Breaking the dominance Range High that's what marked the end of the rally so in 2018 and in 2019 Bitcoin rallied until the dominance was uh was able to break its Range High and then after that occurred after it broke the Range High we saw a correction in Bitcoin but in both cases the dominance continued up now you might say well why compare it to 2018 why not just compare it to 2019 and you have a valid point like maybe we should only be comparing it to 2019 because 2019 was the prehabbing year um but I also think that this Market throws this curve balls occasionally and we should compare to other other times as well and the other reason to maybe compare to 2018 is because the dominance coincidentally started at the same level when the rally began right I mean you can see that this rally started right here the dominant started at around 39 percent just like it did over here right it started at around 39 percent and this rally by the dominance went up would be when Bitcoin USD went up until the dominance got to that prior Range High and then after it after it rallied half of its its entire rally the rest of the rally was when Bitcoin went back down and it was sort of just correcting back down so what happened was Bitcoin corrected it told the altcoin market hey just kidding right the bull Market's not on and in the altcoin market threw in the towel and then they got wrecked against Bitcoin so what what do we what can we learn from this right well the way what I take away from it is we have two things here to look at first of all is if Bitcoin holds the line right if it holds the line out the 20 week history shows us that when it holds the line like in March the dominant shoots up so if it holds the line and the dominance you would I would expect the dominance to shoot up and then I would expect a lot of these all coins to bleed again on their Bitcoin pairs that would be my expectation okay um and if it doesn't hold the line maybe maybe it rallies back up a little bit and if it doesn't hold the line then you would expect the dominance to still go up just like it did in 2018 and just like it did in 2019 and in those cases Bitcoin USD went back down after the Range High on the dominance was broken if Bitcoin rallies Beyond where the dominance range is broke and let's say it gets to 49 or 49.5 I believe the actual number is 49.23 for those who care but let's suppose the Bitcoin gets to like 49.5 the dominance and it's still the Bitcoin USD evaluation is still going up I would still expect the dominance just to keep going with it right so that's something you know something to at least consider and you know the other thing that I I wanted to mention as well here is um you know in when we when this happened in in 29 or in 2018 I it might be worthwhile to look really really closely because it didn't actually Mark the exact top okay if you look really closely at the rally um so I I want to make sure that we we I show it as clear as I can just in case it matters there's a chance that it won't matter right there's a chance that it plays out completely different this time a good chance right but in case it matters um I do want to at least draw your attention to this idea of you know Bitcoin hit a local high here right and then but at that local high right at this local high you can see that the dominant sort of hesitated a little bit at that level we actually came back down a little bit below the Range High and then it was on sort of a a lower high that the dominance broke out in a sustained manner so the dominance broke out here in a sustained way even though like after that breakout here you can see that Bitcoin USD just put in a lower high right so something to at least um to at least consider now if you look at if you look at 2020 right so we can go look at at 2020 and if you look at the dominance over here so in 2020 the dominance here was around 46 46 in September 2020 when it was sort of testing this and then it it rallied and when Bitcoin held the line at the 20 week what happened the dominance just kept coming up right and it went back up to around 73 or so and so this is why I continue to beat this drum of like you know I continue to wonder what the you know what the draw is to the altcoin market when it seems to me I'm I feel fairly convinced of it though I get things wrong plenty of the time you know playing you know often um so again I mean like it it could play out differently but it's hard for me to get that interested in the altcoin market when it just seems like the dominance is going to go up no matter what right like if if we break the Range High and then Bitcoin corrects the dominance goes up if we hold the line and Bitcoin USD goes up and the dominance goes up sorry did I say the dominance correct I don't know but either way right if if Bitcoin USD goes down then the dominance should go up and then if if Bitcoin as long as it breaks the Range High and if Bitcoin USD uh holds the line and goes up then the dominant should also go up and so that's why I have a hard time uh getting that edge to the altcoin market you know one thing that I said and I want to briefly talk about this because it actually relates to the bull Mark sport band and making some comparisons one of the things that I I talked about quite extensively on um on on ITC premium is that in 20 in 2022 what I frequently said was that you know the altcoin market for me right is not even worth consideration until there's like more than one thing right one of them was until December at the earliest right December 2022 at the earliest now in retrospect December 2022 did Mark the low on total three which is the altcoin market right it's everything besides Bitcoin and Eve however the reason why I still have been hesitant with the altcoin market is because the dominance is so low you know it was you know I want to see it December at the earliest but also I want to see that Range High on the Bitcoin dominance broken 49 and I want to see us go above that and that's where I get interested now look at this you might say well would it not have been a win to collectively by all it's back in December they're up 22 percent hey 22 is 22 you know in chess upon is a pawn I mean it's something 22 but wherein lies the problem for me is to me this is not a win when the Bitcoin USD evaluation during that same period right is up 78 right so again like it you know do you pat yourself on the back if you're holding an altcoin that's up 20 or 30 percent because it's up against USD evaluation when Bitcoin went up a lot more you know I care about this I care about that and I actually I had I had a um several days in 2022 I was debating whether I wanted to go this route or not right do I really want to go this route or would I prefer you because I believe you guys the easier route here would just be to not you know to at least you know personally care about the Bitcoin valuations of all coins but not to publicly talk about it because the truth is is most people don't care that's the honest truth most people don't care and and I'm not going to convince them that it matters for me I can't but I can't help but think right like if you're gonna take on the risk of crypto and the Blue Chip Bitcoin you know has better risk adjust returns or it looks like it's going to outperform because the dominance is in a position to move higher well why take the risk in the altcoin market right I mean bitcoin's up 78 during the same period were total three the altcoin Market's only up like 22 percent so yes I mean maybe if you don't care about the Bitcoin valuation you counted as a win but I would also say you know had you just you know if you were willing to put the money in crypto in the first place and you wanted to put it in in Bitcoin or an altcoin Bitcoin has performed outperformed the collective altcoin market now I understand you can cherry pick a few altcoins there's been plenty that have done better than 77 this year and I'm not trying to say that I'm not trying to take anything away from that we know there are that always happens but I will say that you know be that as it may the altcoin market as a whole because we can always cherry pick right but the altcoin market as a whole has underperformed here's another way by the way if you if you uh if maybe this way to visualize it is better better take a look at total three okay divided by the Bitcoin market cap right so you're looking at the altcoin market cap divided including Stables divided by the Bitcoin market cap you know and to me like this just looks like a um sorry this to me this looks like you know it oscillates right between this range and and right now we're at the you know we're sort of in the middle of the range but where the momentum is taking us down is what it looks like to me now that doesn't mean that we can't you know spend some time in here but you know it seems to me like the more likely direction is for this to ultimately come back down this way you can also look at at total two which includes ethereum divided by the Bitcoin market cap and see something very similar although in this case we are currently testing the range lows right so you know I guess it depends on on do you think that this will hold or not if you think it holds then you know the altcoin mark you might like the altcoin market if you think this breaks then the altcoin market is still is still very risky now I wanted to mention a risky relative to bitcoin remember the altcoin Reckoning is on their Bitcoin pairs um I wanted to mention something else because there are some other similarities and differences that we can take here between where we are today on the bull market so Bitcoin is above it's bull market right clear as day it's above it and in 2020 when we held it as support we were above it right clear as day above it here or above it now look at total three in in uh in 2020 in 2020. we were also above the 20 weight right total through the altcoin market looked strong back then I was very Pro all coins back then I thought they were worth the risk right I was talking about it all the time above the 20 week SMA in a sustained uptrend what's going on with total three today well I mean right now we're below it we're below the bull market smart man we've been below it for weeks we've had three weekly closes below the 20-week SMA now you might say well Ben total three includes a stable coin Market you know that's a valid point you know I'm glad you mentioned it if you do though if you do subtract out the majority of the of the stable coin market so let's say you subtract out um you know usdt you subtract out uh usdc um I'm trying to remember what it is I think it says yeah if you subtract out die if you subtract out uh busd market cap you still see something very similar right it doesn't really make a huge difference but it was a good it was a good thought um so in this case you're still looking at a period where you're getting weekly closes below the bull market sport band for total three which is different than what we saw back in 2020 when we had Wix below it but we were holding the line on weekly closes for a total three okay now I'm going to go back to Total three without stable coins just because it actually has history going back further uh than if I use some of those ones that haven't been around as long here total three was holding the line here we're not in 2019 total three fell below the bull market support Beyond okay but when did it fall below did it fall below when Bitcoin did no it didn't the total three fell below it in July Bitcoin didn't fall below it until I think September I mean it was an extra two months and you can see that total three fell below uh fell below the 20 week back in in May so it's already I mean if this week if this closed if this week closes below the 20-week estimate as well I'm already looking at basically a month below the 20 we got some a four four total three okay so that I I think is something to pay attention to and and I'll let me let me phrase it like this if total three is unable to get back above its 20-week SMA in short order then it could be a sign that this rally by Bitcoin is more so a function of liquidity from the altcoin market going to the relative safety of the Blue Chip or the Blue Chip sorry Bitcoin and eth in this case you're talking about Bitcoin but ethereum's also been doing doing well the ethereum dominance has been holding about 20 which is impressive um so if total three is unable to get back above the bull market sport band then it shows in my opinion that liquidity is not really coming into the altcoin market it's just bitcoin's rally is being supported by a liquidity drain from the altcoin market back into Bitcoin if liquidity comes in you know if a lot of liquidity comes in and can get back and can get the altcoin market back above its 20 week SMA then that would be a bullish sign in a sustained way right if it can get back above it and hold it that would be a more bullish sign for Bitcoin uh to sustain the rally like 2020 but the issue is that if it stays below this level like it did in 2019 then it could be a sign that the market is fading right but in this case once we had weekly closes below the 20 week it meant the high was in for Bitcoin I mean you know the the altcoin market got below the 20 week in July and and Bitcoin hit its peak in June um over here the altcoin market got below the 20 week SMA in May and at least locally the local high for Bitcoin is in April again will it you know will it break below or not I mean look bitcoin's been resilient so far this year and and I've said before right like if it wants to push higher I think it needs to do so in the first half of the year now I mean there does exist a scenario of course where it pushes higher in the second half of the year uh but that's been my my thesis is that if it's going to it should do so by June like we should know I think by the end of June what what what's going to happen I mean if if this is if if the if we're going to get the move to say like you know the mid-30s or something I imagine it's going to come within the next like you know four or five weeks or so if it doesn't happen there then I I don't know that I mean we could just end up fading it like we did over here in in 2019. so a lot of things to consider I mean again like you can find comparisons uh you know if you know if you're a bull or a bear you can find plenty of comparisons to sort of support your own thesis um you know just uh just to say one for the bowls just because I did I just did a couple for the Bears um you know I mean here you could argue that we held the line here sort of I mean we didn't really go down to it and then we did it again and then maybe we're doing the same thing here right and we're just climbing the wall worry so I mean regardless my opinion is right the dominance should go up no matter what and it's slowly climbing I mean it's slowly climbing and if you look at if you look at the uh the 10-week SMA on the dominance you can see that it it held here in January and then it held in March and then now it's theoretically holding in May and eventually I think it's going to come up here and and sort of squeeze you know squeeze this level or squeeze into this level at 49 and I think it's going to break above and then the question is right is what happens when it breaks above does that Mark the local high for Bitcoin or even if even if it's a lower high like in 29 or like in 2018 it would suddenly a slightly lower high does that Mark the end of the strength or does it follow what Bitcoin USC did in 2020 I think one of the things to look for as I said before look at the altcoin market I mean I think the cryptoverse is fascinating in some sense because you can use various sectors of crypto to kind of tell you or at least get an idea of what's going on you know the altcoin market as it stands is still looks it has been relatively weak again I'm not saying that some of them haven't gone up some of them have I mean ethereum is that is at a 1900 okay I mean there's plenty of all coins that are up some right the question is is can the altcoin market as a collective get back above its bull market if you include eth it is above it right so that's something you know that's something to consider we did go below it though very briefly um and maybe I have to take that back it's not below it or it's not above it we're actually below the 20 weeks so we're above the 21 week EMA okay so we're above the 21 week EMA uh when you when you look at total two which includes eth but we're we're still below the 20 week estimate I believe I mean you can see we're at 581.2 the 20 we got SMA is at 583.2 basically so I mean it's just a little bit higher a couple billion dollars higher than where we are right now right what's a couple billion dollars among friends um so not too much higher uh than where we are um at the at the current time so what I'm going to be watching for over the next couple of weeks is does Bitcoin get you know does it go back below the 100 day and if it does can it get back above or does it continue to put closes below it like 2019 or does it follow 2020 and and maintain a level just above the 100 day okay so I look at that I would look to see if total three can muster up the courage to get back above its bull market support ban because if it does then it might be a sign that some liquidity is entering into the market if it doesn't then it might be a sign more so like 2019 that the rally is only in 2018 that the rally is only being supported by the bleed of the altcoin market back to the Blue Chips we're actually seeing something very similar going on in tech stocks right I mean look at the ones that have held up the s p this year it's only like seven names that account for basically the entire move in the S P 500 this year you could argue that it's a very similar idea that people are fleeing the the lower market cap plays for the relative safety of the higher market cap plays because they offer more liquidity and they might offer they might be a safe haven not to say that in a in a during a bad event it's not to say they won't go down it's just that because they have more liquidity they probably wouldn't get hit as hard and so there is this idea of is this a flight to safety um I mean so far the US economy has been resilient and I've said before that I don't think we're in a recession I don't think we had a recession in 2022 I don't think we've been in a recession in 2023 either I just think that at some point we're going to get the uninversion of the yield curve who knows if that's going to be six months from now 12 months from now 18 months from now who knows when it's going to happen the bond market thinks it's going to happen by by November but at some point when that happens that's where we normally get the recession so I don't really think we're in one right now but you know one's probably going to come at the end of all this because at some point the fed's probably going to break something in their quest to fight inflation and I mean arguably they haven't done it yet I mean at least what they did break they were able to solve very quickly the issue is if they get to something that they can't just solve by by sort of putting a Band-Aid over it so again I would watch the 100 day for Bitcoin see if Bitcoin holds a 20 week estimate at 26k look I mean if look for a potential if it's a lower high or a higher high look for total three to see if it can get back above us 20 to make estimate if it can't that's not it's not a a great sign if it can then it might it might sort of turn sentiment around and um I think that's probably probably mostly it probably what you should what you should look for over over the coming weeks so um I think we'll wrap it up there and if if Bitcoin can if Bitcoin does push higher I mean if it does sort of take out this level here right if it does push higher look for the dominance look to see where the dominance is and look to see if there's any type of change in Behavior above 49.23 right I mean who who wants to know specifically to look at around 49.23 or so that's the prior Range High uh for the dominance back end back in 2021 if nothing fundamentally changes then um then that would be something to note if it does fundamentally change and Bitcoin sees a correction after the dominance range is broken and the dominance holds that would be a a similar case to look at uh for the prehabbing year back in in 2019. if you guys like the content make sure you subscribe to the channel give the video a thumbs up but again check out into the cryptoverse premium at into the cryptiverse.com thanks for tuning in I'll see you next time bye

Channel: Benjamin Cowen

Views: 55,575

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: 4Fy4UMPy3Q4

Length: 49min 35sec (2975 seconds)

Published: Mon May 29 2023