Transcription
Hey everyone, and thanks for jumping back into the cryptoverse. Today, we're going to talk about Bitcoin dubious speculation. If you guys like the content, make sure you subscribe to the channel, give the video a thumbs up, and also check out the sale on Into the Cryptoverse Premium at intothecryptoverse.com. Let's go ahead and jump in.
I am getting pretty excited about the first ITC conference. We've lined up a lot of great speakers and we're still lining up more. Uh, we will at least be able to have the first edition of NFA Live, actually live, uh, because we will have both Rob and Guy at the conference. And believe it or not, we've never all been, uh, at the same place at the same time. We've met each other individually, but not all three together. We've also got a lot of other great speakers coming as well. Uh, you can check it out at the website Benjamin Cowan.com and then go to the conference tab. I look forward to seeing you guys there. Let's go ahead and jump in.
So, with these Bitcoin dubious speculation videos, right, we have to remind ourselves that no one knows what's going to happen in the short term. It doesn't matter how confidently someone says anything. The truth is that no one knows. But over here on this channel, we have used our understanding of seasonality and the four-year cycle for Bitcoin to best understand when lows are likely going to occur and when those counter-trend rallies could occur. So, we do that as an academic exercise, right? That's the reason why we do it. The way that I stay entertained throughout the midterm years is in the summer I watch the World Cup. That's a lot more exciting to me than trying to time counter-trend rallies in in Bitcoin. Be that as it may, as I've said, DCAing Bitcoin in the second half of midterm years normally works out pretty well as long as you have a long enough time horizon in mind. Of course, that's not financial advice.
Now, let's talk about the seasonality, right? Because one of the things that we've mentioned is that despite the mental gymnastics, right, despite the mental gymnastics by those that have suggested that we can't look at at prior cycles to give us any insight, the prior cycles have actually been really insightful in helping to to navigate the current market cycle. I understand that it's not like we have a lot of data points. I'm not disputing that, right? I mean, I, you know, I studied engineering. I I know you need more than three data points for something to be statistically significant. We're doing this as an exercise. And despite how it's not necessarily statistically significant, it's the best we have and it actually keeps working out to the dismay of those who faded it. And what we've talked about is how Bitcoin likes to form lows in February of midterm years. February of 2014, February of 2018, February of 2022, sort of a higher low, but still a low. And then February of 2026. Oftentimes going into February, Bitcoin is weak and then it it finds a low and then rallies into early March. So, we talked about this early on, right? And before that, we talked about how after you get this initial leg of the bear market, especially where Bitcoin drops below the, um, the 50-week moving average right here, it's it's that's the final nail in the coffin, right? You don't need any more confirmation than that. You didn't even need that if you wanted to defer just simply to the ROI from the low, right? Like if you look at the ROI from the low for Bitcoin, you'll see that it topped this past cycle on day 1,062. The cycle before that topped on day 1,59. The cycle before that topped on day 168. So to within a week, Bitcoin ended up topping. And now I've suggested that to within a similar time frame, Bitcoin could end up bottoming, which would put it like really late September or early October. That is when the window would be. Now, I suggested that about eight months ago, and every time we've had a counter-trend rally, of course, people like to make fun of that, right? They're like, well, you know, if you're waiting for that, you missed out. And then eventually, Bitcoin just went lower. But what I said was ignore Bitcoin for the first half of midterm years because it's going to bleed against basically everything else, right? And we can verify that. I mean, you can look at the valuation against Bitcoin of Bitcoin against say gold and look at let's look at at six-month candles. If you look at six-month candles, did Bitcoin go down against gold in the first half of the midterm year? Yes, it did. It dropped about 28%. Did Bitcoin go down against the S&P in the first half of the midterm year? Yes, it dropped about 39%. Bitcoin also dropped against the energy market in the first half of the year. It dropped about 44%. Even silver, which had a big pullback, Bitcoin still dropped 18% against in the first half of the midterm year. So, we talked about simply ignoring Bitcoin as an investment for the first half of midterm years because it's basically just going to bleed against everything else in the other asset classes like the the major the major things. You could even take an example like Microsoft, which actually had a really bad first half of the year. You can see it dropped 22% in the 20 almost 23% in the first half of the midterm year. And note that Bitcoin also underperformed that as well. Sorry, let me pull this up. Having trouble getting it to load, but let's see if I can get it here. So, here you can see Bitcoin. Let's load it again. Bitcoin divided by Microsoft. And we're going to switch back to six-month candles. You can see what I'm talking about. You can see how Bitcoin dropped against Microsoft 13% even though Microsoft also dropped. So, Bitcoin just doesn't do that well in the first half and midterm years. And to put the cherry on top, the actual low that Bitcoin had that it that it just formed, the actual low occurred on July 1st, thus proving there really wasn't a great reason to be all that interested in Bitcoin in the first half of the midterm year. You could have ignored it all year long, bought some on July 1st in the second half, and you would have outperformed everyone else who decided that the four-year cycle was a meme and and and that they wanted to be they wanted to outsmart it because they thought that the market couldn't be so simple. I've been there before, right? Like I mean, I markets can often be way more simplistic than we make them out to be. And I I understand like the desire to for people to to to sort of mock those that that just sort of went along with it, but the reality is is what what other indicators have we had this bare market that were better than just looking at the cyclical nature.
If you look at Bitcoin in 2026 and compare it to say 2018, which is one we've compared it to a lot, the lows line up. Even the lower high in May lines up. The the drop into late June, early July lines up. Even this little counter-trend rally we're in right now lines up. And even this little secondary pop kind of lines up. We ended up getting one more slight dip into mid-July and then we got a larger move up to near the 200-day moving average back then. If you look at at how it played out in 2018, we had our first rally to the 200-day moving average in May and then we had another one in late July. Doesn't mean we have to go all the way up there, but what you'll see is that the lows form around the same time. In fact, in the same way that Bitcoin swept the low in 2018, look at look at I mean, it's kind of crazy. And I know more people are getting on the bandwagon now, but we pointed this out like half a year ago. You see the February low here. In 2018, we swept the February low in late June, early July. The same thing happened in 2026. We had a February low and then we swept it in the summer. And what I've said is that Bitcoin is getting squeezed. You could call it between say the 200-day and the 200-week. If you look at it on the weekly time frame, you can say, okay, the 200-week moving average is sort of it's trying to hold as support, but to the downside, it's getting dropped. It's getting sort of pushed down by the bull market support band or in this case, the bear market resistance band. So, it's trying to go above it and getting and not able to break out. It's trying to go below it and not able to break down. So, what's happening is Bitcoin is sort of like going back and forth between these two levels and then we'll likely get some type of resolution in the fourth quarter of the year. Now, in 2018, the resolution was that it broke down. Now, I'm not here to say that it has to, but what I am here to say is that in order to fully reset all of the on-chain indicators, some of them have already been reset, but in order to fully in order to fully reset all of them, Bitcoin's price would go a little bit lower. For instance, if you were to look at some of the other indicators, right, before we get into specific indicators, because I'm already on the chart, let's look at Bitcoin in 2026 compared to the average of prior midterm years and overlay one standard deviation to that average. And you can see like this is off the the window that we're in right now is sort of like a mild brief window of strength. It doesn't go you wouldn't expect Bitcoin to go up that much, but it does tend to go up for a little bit in July before then going further down in August, September, October. So this is still playing out like like normal. But if you wanted to look at at some of the individual indicators, right, you could look at like the, uh, the MVRV Z-score, for example, and see that in order for it to fully reset historically, it does go below zero. And if you look at, you know, if you look at this, you can pretty clearly see that we haven't made it there yet. Now, that's no guarantee that we will, but maybe this time isn't different and it is simply going to play out and it just hasn't played out yet. If you look at, say, the realized price, the realized price is something that Bitcoin historically goes below and you can see that it has gone below it every prior midterm year. Even in the 2019-2020 example, you can see we eventually went below it. And so, the argument is is like we will likely go below it again. And that's currently at around, you know, 53K. The balance price is a lot lower. That's down at around 38K. Historically, we've gone below that as well. That might be a little greedy, but look, if if the stars align and and the fear overtakes everyone later this year, I don't know what the narrative will be. Um, it could be a thousand different things, but normally the things that people are thinking about now, it's not likely that whatever it is, if Bitcoin were to drop to that level, it would actually be very similar to how it played out in 2018 and how it played out in 2019, where you found support at around 6K and then you had your final drop.
And have have any of you guys noticed like how uninteresting the market is right now? Like how you probably just don't really care? I'd like to say there's dozens of us left. Like a lot of people just simply do not care. It's there's this complacency. It's apathetic. It's apathy, right? There's just a, there's apathy that exists where we people just don't care anymore. Like I know there's a few gurus on Twitter that would have a field day if Bitcoin were to go back to 70K, but even if it does that, it's still below the 200-day moving average. And they might care and they'll probably use that to then say that they were right, even though they've been dead wrong for eight months. But the point is is most people wouldn't care if Bitcoin were to go to 70K or even 80K. Are people really going to come back even if it goes to 90? I mean, Bitcoin just spent, you know, a year basically above the current levels and we still couldn't attract retail interest into the space. If you look at the social interest that I we've been tracking here for like many many years, it's been trending down. Now, that is not in my best interest, right? I mean, like, and I I tell you this not because I want it to be this way, but because I feel like it is my duty to tell you the truth. People spent years trying to convince you that all these false narratives were the truth, but time reveals the truth. Now, the gurus can sit around and do what they do best, call for alt season, shill the altcoins they've shilled for the last five or six years and and chalk it up to being quote unquote, you know, what they think is based on the data. But the reality is is they've been wrong for years. And and I've said this before, there's a lot of good guys out there, but they don't understand like what's going on in the markets. And one of the ways to think about it is the the pathway to hell is paved with good intentions. Someone can have good intentions on say promoting an altcoin and and and shilling something because they truly think it's going to do well, but that doesn't mean it's going to, right? That perhaps they're missing something. Maybe they're in a bubble and they don't recognize that no one else is actually using that product. So there's a lot of people with good intentions who are good people who who have been completely wrong about the markets for years and I've been wrong at points and I try to own those mistakes, right? I mean I was got some pretty bad stuff wrong in 2023, um, in 2022. It took me until February to kind of admit we were in a bear market. Like I'm not perfect. I get things wrong. But the thing that people make the mistake of doing is when they are wrong, they don't admit it. And I think that's the hard part is you have to admit when you're wrong. Because if you don't admit when you're wrong, then you're just doomed to make the same mistake. You're doomed to just tell your audience the same thing over and over and over again because the the alternative to say the words I am wrong are so incomprehensible that that's not something that would ever actually be considered. And so they just kind of dig themselves further into these narratives rather than look at the chart for what it is and say, "Look guys, I was wrong and and I have to move on." And when I get things wrong, you should call me out. And and you have, right? You have. And and I've had to swallow my pride a few times. And it's it's tough. Like it's tough. Like I don't I don't like doing it, but if I hide behind it, then you're not going to I won't learn. I won't learn from the mistakes that I've made. So, we all get things wrong. No one is perfect. These are not digs at anyone. In fact, I'm I I could be talking mostly to my former self and saying, "Look, this used to be how I was and then I figured out I needed to change and then once I did, I feel like it it made me a better investor, but I'm not perfect and I will still make mistakes."
If you look at the social interest, like I mean, it's just simply been trending down for years. Since May of 2021, it's been trending down. And if you look at at YouTube views to various crypto YouTube channels, you can see that they're averaging around 400,000 views a day. Now, that might sound like a lot when you look at all these channels, but again, comparing it to what it was back in 2021, they were averaging an order of magnitude more, 3 to four million views per day. So, you're talking about an order of magnitude less. Now, when you look at something like the advanced decline index of the top 100 cryptocurrencies, it's been dropping like a rock for years. The money supply hasn't saved the altcoin market. QT ending didn't save the altcoin market. The ISM, PMI stuff, that didn't save the altcoin market. The hype around the Clarity Act didn't save it. None of that stuff did. But those have been the prevailing narratives for years, right? And so the argument is that there's only so long that people can kind of run with those narratives before there's like, all right, what's going on? Like why is it not following that stuff? And the reason why the crypto market is not following that stuff is because 99.9999% of the crypto market has no business having any value to begin with. Right? That's the honest truth. That doesn't mean there's no value. It just means that when you look back at what the asset class actually accomplished in the last cycle, the main accomplishments were the ETFs and the strategic Bitcoin reserve, right? And and the memecoin stuff, right? Like the all the memecoin launchpads, which is hardly a success, but that is what was rewarded. So if the main thing that is rewarded in an asset class is just figuring out on-ramps to get more people into the market, then the fundamentals could start to break down because then people are not actually focused on what they should be focused on. They're just focused on how can they sell the bag of what they bought to the next person. And the way they do that is by hyping up strategic reserves and ETFs and memecoins, right? You just get people to go buy the stuff that you bought. You sell it and then you say like later. When you focus on that as an industry for many many years, you have an example like what you see now where the advanced decline index of the top 100 has just been melting down for five years where most cryptocurrencies just keep going lower because they have no intrinsic value. You can put a cute memecoin or you can put you can put a cute mascot on a memecoin and say that it's a great investment and talk about the great community, but time reveals the truth. So, I think that is is kind of the hard lesson that a lot of people are are facing right now is that this is the first cycle where at the end of the four-year cycle, there was no rotation into the higher risk investments that were peddled for the years before it. And so what people have done is rather than be like, "All right, yeah, that was the wrong view," they've then sort of changed it and now they're trying to like, you know, convince you that it's still playing out even though a lot of the altcoins have completely round-tripped all of their gains and have gone even lower than their 2022 lows. Okay, that's the problem is that a lot of people round-trip the bull market with the altcoins that they held. So when we look at this, you can see the crypto market has been bleeding for years, right? The only reason the crypto market looks okay is because of Bitcoin, right? Like it's because of Bitcoin. Most everything else has been completely annihilated. One of the reasons why Bitcoin dominance is struggling to go up a lot right now is because of stablecoin dominance going up and because the altcoin market already got annihilated, right? Like if the altcoin market already got annihilated, I mean, it can still get more annihilated. As I've said before, just because it all dropped 80% doesn't mean it can't drop another 80, but that's the reason. And we've seen this before. Like we've seen a period where Bitcoin dominance struggled to go back up after a apathetic top like in 2019. It's the same thing. And then eventually Bitcoin dominance broke to the upside on a parabolic rally by Bitcoin. So the problem for those that continue to promote alts day in and day out is that in order for them to actually start outperforming Bitcoin for just a month or two where maybe more than a month or for them to really outperform for say like four, five, six months in a row collectively, you first have to have a parabolic rally by Bitcoin where Bitcoin triggers a lot of the euphoric indicators.
If you go back to the terminal price chart, you can see that we actually did not hit the terminal price this cycle. One other time that happened, 2019, and we've made the comparison between 2019 and 2025, 2024, 25 for years. Three red cuts in 2025, three rate cuts in 2019. QT ended in 2025 in December in in December and Bitcoin topped two months earlier in October. In 2019, QT ended in August. Bitcoin topped two months earlier in June. So, there's a lot of similarities between this stuff, right? In 2019, no rotation to alts. 2025, no rotation to alts. We're in this phase. We're in the post drawdown digestion phase after the non-apathetic top or sorry, after the non-euphoric top. It was an apathetic top. That's where we are. The problem is that people thought it was only going to last a couple of months, but in fact it happens to align with the midterm year, which historically is a weak year. Midterm years historically are weak and normally those bear markets last about a year. Now, could you argue the bear market could last shorter like 2019? Yeah, if you have price-based capitulation, you can see the orange line over the blue, which was 2019-20. We haven't had that. I'm not calling for a pandemic. I don't think that's the most likely outcome. I think time-based capitulation is the most likely outcome. But in order to have that, it normally takes about a year. And when time-based capitulation ends, it usually aligns with a big spike in volume, which we haven't had yet. As you can see, at the end of 2018, or sorry, at the end of 2014, there was a big spike in volume that marked the end of the bear market. Same thing at the end of 2018. Same thing at the end of 2022. We haven't had that yet. Now, you might say, well, because it was an apathetic top, maybe it'll be an apathetic bottom. The problem is that even in 2019, 2020, we still had a volume spike at the end. Now, yes, it was due to the pandemic, but the problem is that like there's always a reason. And I don't know what the reason is this time, but whatever it is, people are probably going to be like, well, you know, you couldn't have predicted that the four-year cycle got lucky again when in reality, it's just playing out the way it always does.
So for for Bitcoin, yeah, like July is normally a strong month. You know, I'm not here to say that it's not. On average, the the return of Bitcoin in July in midterm years is positive, right? Like look at 2022, Bitcoin went up 20 almost 20%. 2018, it went up almost 38%. 2014, it was red but only negative 5%. So on average, Bitcoin is green in July. And a lot of times it's green in July after a red June. But guess what? In 2022, August was red and September was red. In 2018, August and September were red. In 2014, August and September were red and also October. So, the problem is that July, yeah, it's could very well be a green month. And and maybe the way it plays out is how it played out in 2018 where you get, you know, another little dip in mid-July and then it goes up into late July or mid-August, finds another lower high and heads back down in August, September time frame. I mean, we're getting squeezed between the the 200-week and the bear market resistance band, and we've had fake-outs on either side of it. Now, the problem is they're going to meet soon, and when they meet, we're going to have a resolution, and that resolution is likely going to kick off in about a month or two. And guess what? If there is a capitulation at the end of the year like 2018, like 2020 or like 2022 or like 2014, it usually just sets up the next bull market, right? Like it's not something to be scared of. It just usually sets up the next bull market and then none of it mattered in in the end. So try to have a long time horizon. Fade the gurus that that still show you the same narratives every single year for the last five years. Fade that stuff. Okay? Those guys can turn it around. They just have to admit they're wrong. Like everyone has to. And then once they do, everything becomes a lot clearer. That would be my advice.
All right. And for you, I think what what a lot of people should do in this situation is look at the data on the chart and stop trying to like focus on all the different narratives. Yes, sailor selling optically doesn't look that great. Yes, I Yes, we know that. And this is why I say even treasury companies will bleed to Bitcoin over long enough period of time. Yes, the unemployment rate, you know, is is a little finicky, but it's been okay recently. It all there's so many things you could look at. I don't know what the narrative is going to be at the end of the year. But what I will say is this is the same people that have been bullish throughout the entire bear market, if history is any indication, they will likely flip bearish at the beginning of the bull market. I know that sounds crazy, but I've seen it happen before. It's like if you get the memo that the bear market is here when it first arrives, it's so much easier to flip bullish when the bear market's over. If you don't get the memo that the bear market is here until the third stage of the bear market, which is where we've been for the last few weeks, it's so much harder to flip bullish because your cost basis for selling for a lot of these guys, is a lot lower. The time to sell Bitcoin, if you're going to, was late Q4 of last year, not anytime this year, in my opinion. In fact, DCAing Bitcoin starting in the second half of midterm years historically works out as long as you can stomach a little bit of downside. If you can stomach that, it probably doesn't matter long term. But you got to stop trying to time the bottom because the reality is is no one's going to time it perfectly. I can assure you I'm not. And I'm just doing the best I can. And trying to keep it as simple as possible. I have five kids. I have a life outside of this. I want to go watch the World Cup. I actually got to go see the Argentina match against Egypt. It was probably the best game I've ever seen in my life. There's other things to life than just staring at the charts. So, let's keep it simple. I'm deferring to the four-year cycle until proven otherwise. I would I want to establish positions in Bitcoin in the second half of the midterm year. Ignore the narratives and hopefully set up for the next bull market that hopefully can come late this year going into 2027. That is my focus. I might get it wrong and if I do, I will say it, but that is my focus.
And at the end of the year, we have the ITC conference. It's not a coincidence that I put this conference in November. The reason it's in November is because I'm hoping the low is in by that time. If it's not in, I think it'll be really close to being in, but I think there's a good chance, maybe 60 to 65% chance that by November 21st, which is the main conference day, I think the low will be in. So, one of the main themes of this conference, while it's not a crypto conference, one of the main themes will of course be Bitcoin. So, if you're interested, make sure you get a ticket to the first ITC conference November 20th through the 22nd in Miami, Florida. Um, go ahead and get a ticket if you guys are interested. And we've we've been lining up a lot of great speakers. I'm sure you'll recognize a lot of them. So, make sure you guys check that out. And we're not going to have as many as as some of the conferences. And and this conference is not just going to be like treasury companies talking their game. We want to look at the markets with data with a lot of the the the best minds in the spaces in in various asset classes and and that way the people that go hopefully can then form their own idea of how they want to navigate the markets.
If you guys like the content, make sure you subscribe, give the video a thumbs up. Again, check out the sale on ITC Premium at intothecryptoverse.com. And I hope to see you guys at the first ITC conference in Miami on November 20th through the 22nd. I will leave a link in the pinned comment and the description below. I'll see you guys next time. Bye.