Transcription
Hey everyone, and thanks for jumping back into the cryptoverse. Today, we're going to talk about Bitcoin, as it has hit a new all-time high after bouncing off the bull market support band.
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We went through this, uh, process pretty closely and even talked about how this might play out exactly like 2020 did, at least after the local high in August. You get a two-week rally off the bull market support band, and then a two-week drop, and then a rally to a new, a new cycle high. Um, and that's basically what happened over here, right? Two weeks up, two weeks down, and then you can see the rally that then ensued.
What's really interesting about Bitcoin is that it seems to be repeating the same pattern over and over and over again, where it, it, you know, it puts that high in August, it then puts in a low in September, and then rallies into a market cycle top in the post-halving year. Now, the high is not always August. Sometimes it's like early September, but going back to 2013, you can generally see a high in August, a low in September, and then a rally into the market cycle top. Same thing in 2017, you see the rally into the market cycle top after that September pullback. Same thing in 2021, and then sure enough, once again, we saw the same thing play out.
So, it's funny because, you know, it always feels like when we talk about, like, this is the most likely outcome, and then everyone does these, like, mental mind games where, like, "Well, if everyone's talking about it, then it's not going to happen," and then it ends up just happening anyways, you know?
Um, so, I mean, it is nice that Bitcoin has gone to an all-time high, and hopefully, it can go higher. Remember in 2021 when it finally went higher, um, you know, in October, it was only a sweep of the prior high from April. Ideally, we see more than just that at this point, but I'd like to see some, you know, some daily closes actually above the prior wick high. We haven't actually seen that yet. So, you can see that wick there. We did get a close above, but then the second one, we have not. So, let's see if we can get some follow-through by Bitcoin.
The one thing to note is that Bitcoin dominance does continue to go up. So, people are slowly getting the memo that liquidity is inflowing to Bitcoin. Some people, I feel like, are, you know, on Twitter, they're like, "Well, what about Bitcoin dominance, guys? It's been going up for three weeks, you know?" I mean, it is moving up, right? It was up .32%, then .99%, and then 1.32%, right? It is moving up. It might not be moving up as quickly as you want it to, but dominance is, in fact, moving up. So, we'll see what Bitcoin does.
The one thing I will say with it now being October is don't be complacent, right? Because as much as everyone wants to believe that this time is different, and as much as everyone wants to believe that it's like a five-year cycle or something like that, anything's possible, anything's possible. But the reality is that all major market cycle tops have occurred in the fourth quarter of the post-halving year. And I think it's prudent to just not get complacent about that idea as we progress through the fourth quarter.
Now, unfortunately, no one has a crystal ball. You know, no one can tell you exactly the price that Bitcoin will top at, whether it's $125K or whether it's a lot higher. But I will say that some of the things that you can use, like one of the things that you could potentially use is a couple of weekly closes below the 50-week moving average. That's usually a sign that the top is in. So, again, that 50-week moving average is now at $101,000. And what you'll notice is that all prior tops were in when Bitcoin got weekly closes below that 50-week moving average. Normally, it happens in that post-halving year or sometime in the midterm year. So, watch for that. That's usually a sign that the cycle is over. We're not there yet, right? Like, Bitcoin is still trending up. It's just something to keep in mind for now.
Bitcoin has bounced off the 21-week EMA and then it came back down, found a higher low, and bounced again. So, we've seen a really nice move by Bitcoin, but again, we want to see follow-through. Last cycle, we didn't really get the follow-through. Hopefully, we can see it play out, um, with a little bit more strength this cycle, but, you know, again, nothing is guaranteed.
I think the way to think about this is the most likely outcome is topping in Q4, right? And with Bitcoin putting in a new all-time high in October, it just kind of like validates this whole cycle theory stuff that, you know, even throughout the post-halving year, here we are, Q4, the post-halving year, and once again, we have a new all-time high. And once again, we have people saying that it's not going to be the quarter where the cycle tops out.
I'm going to go into it assuming, in my opinion, I'm going to go into this assuming that the top will be in Q4, and I'm going to be looking for indicators that'll provide, you know, confluence to the idea, you know, whenever that is. In the short term, let's see if Bitcoin can get some follow-through on this. If you look at last year, when it had this, like, big weekly candle up, it then just continued to accelerate. Same thing in 2023, it just continued to accelerate. So, ideally, ideally, this week we see that acceleration. If, for whatever reason, we don't see it, then, um, we'll have to talk about that because, you know, by some measures, right, by some measures, we already are kind of far along in the cycle, depending on how you measure it. Like, if you measure it from the bottom, like, and you look at where we are right now, it would suggest we're further along than people think, you know, which is kind of a scary thought, right? It would suggest we're further along than people think.
In fact, you could already argue that it's gone on longer than last cycle at this point because last cycle topped after 1,059 days, and, you know, we're now at 1,061, 1,062 days. So, it's actually already gone on a little bit longer than the last cycle. But the cycle before that lasted 167 days. That's if you measure it from the low. If you measure it from the peak, um, that's a little bit more optimistic because if you go peak to peak and you compare it to two cycles ago, you could say that we're currently on day 1428, and two cycles ago didn't top until day 1473, which is basically another more than a month and a half, right? So that would actually get you, you know, further into Q4, potentially even getting you into the last month of Q4 if you want to measure it from peak to peak.
And if you want to measure it from the halving ROI after the halving, you can see that we are, you know, um, two cycles ago, it topped about 525 days after. Currently, we're at day 534, and the last cycle was day 546. So, again, like, by some measures, we're already further along than people probably think we are, but then by a lot of measures, like, we're not really close because a lot of the peak indicators that you would think would be firing off haven't really done that, you know? And so, we either have to face the, you know, the two choices are that we just haven't seen the parabolic rally into the market cycle top, or it's different, you know? And I don't really think anyone here is willing to accept that it's different and that you won't see a more extravagant rally just yet.
But again, if you see Bitcoin sometime later on this quarter get weekly closes below the 50-week, that's probably it, right? That's probably it. So, we'll take it one day at a time. We'll do a video probably soon where we go through some of, like, the peak indicators, like some of the indicators that you would expect to sort of fire off saying that, like, this is the top, um, like we had last cycle, right? Because, like, last cycle, it wasn't in November, but in April of 2021, like, all the indicators that people had created, we're essentially going off in April of 2021. None of them have really gone off at this point this cycle. The only ones that have are the time-based indicators, right? Like, this is how long the rally normally lasts after the halving, or this is how long the rally normally lasts after the low. Like, those are the only ones that are starting to fire off, um, whereas the other ones, the ones that try to help us identify euphoria, haven't actually done that yet.
I think the scary thing is, you know, we haven't really seen retail, new retail investors come back, right? If you look at the social risk, it still remains relatively low. So, I guess, you know, are people going to come back? Or people just don't care anymore? Again, like, do I think Bitcoin has done what it's always done? Yeah, because that's Q4 of the post-halving year, and it just put an all-time high. So, we can celebrate that this view has played out.
I think a lot of the euphoria, or lack thereof, comes from the fact that the altcoin market continues to struggle, and unfortunately, it's probably going to continue because Bitcoin dominance is likely heading higher. You know, it doesn't matter if you like it or not. The truth doesn't really concern itself with what other people think, but dominance is likely going to go higher as Bitcoin just continues to suck in liquidity from the rest of the cryptoverse.
So again, one of the things I mentioned to look for confluence for these new all-time highs in Q4 was watch for Bitcoin dominance to go up. We saw that Bitcoin dominance was going up. So, we said, "All right, we're likely going to continue to see a rally into October, get a new all-time high." Because we see dominance going up, we see that the market is figuring out what matters. And sure enough, a new all-time high happened. Bitcoin went to $125,000, $125.7K.
So, we'll take it one day at a time. I honestly, I have been kind of sick this past weekend, uh, so I haven't been feeling that great, but hopefully, as we get a little bit later into the week, we can go through more of these indicators that talk about, you know, euphoria versus the time-based stuff. And we'll just talk more about that in the next, in one of the next videos.
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