Transcription
This is the most popular bare scenario happening for Bitcoin in the opinion of 90% of market participants. And in my opinion, it is all wrong. It is not happening. And today I'm going to explain why and what I think is actually happening with Bitcoin.
We're also going to remind ourselves about the recession indicators and why they are still stalling and why this is not happening yet. And we are going to revise some of the realistic scenarios for Bitcoin because there are only two of them. And also we're going to watch some altcoins.
And just to remember, I have a small channel, not a lot of clips here. And after you watch this one, please just go watch the others because this is how you will understand my uh investment thesis because we are different human beings and we have different investment strategies. When you are watching some random guy on the internet giving his own thoughts on the market, you should always understand what is his investment thesis because otherwise the whole vision will not make any sense. And also the video today.
Now, what is this? This is actually a fractal from back in 2022. How do you copy a fractal? You go here on the Trading View chart for Bitcoin. On the left here, you have the bars pattern. You select it. You go to the top all the way to the bottom. And this is the final result. So basically all over the internet, all over Twitter, all over YouTube right now, we have a confirmed bare market and every analyst out there with 500K followers or maybe over a million are teaching you how to navigate it.
Now it is my job as an investor to cut out the noise and to play all the scenarios possible and after that observe what is the most probable scenario and another less probable scenario to happen. So basically I'm doing this all the time because the market is evolving and you guys as investors should evolve too and everything and every scenario possible is happening at the same time.
Now, if you remember some of my old clips, I was mentioning this uh exact window of seasonality going into January 20 to see if this is a local low or a local high because the next window of seasonality depends a lot on what Bitcoin does until this one. Either we have a pivot low, then we go straight up into March and the start of April, or we have a pivot high, and then we go down into April. We start from there.
Now, going on to my Twitter, there's a lot of you guys that ask me very often for a new YouTube update, but I don't always have the time. So, maybe just be signed up to my free newsletter because there I'm updating more often.
Now, some funny stuff. Uh, these guys right here at the Pico Top in 2021, all of them in Unison predicted 200K coming for Bitcoin. One, two, three, four. These old guys right now, all of them in unison believe that this is the case for Bitcoin right now and the bare market already started. So just some food for thought here. And another one, Rect Teachi posted these uh thumbnails from these guys after a 36% discount on Bitcoin. They are all calling for tops. Will bounce, but it's not good. Sound familiar? Will bounce, but it's not good. Navigating Bitcoin bare markets. All right. Such nice.
But in the last season in 2021, I was a follower to this guy and he always mentioned the lengthening cycle that is to come in 2022 and so on and so forth. Bearish thoughts all over the place. This is coming next. Just copy paste this fractal. Wait a little bit and we all start a short at the same time. Wonder what could happen wrong here.
So, basically going back to a post of mine from March 9, 2024 at the Pico top or let's just say uh the Pico local top after calling for the all-time high for Bitcoin before the halving. It was actually me and some other five guys, I started to play with some uh psychological thoughts. What would people do or think when the all-time high happened before the halving? And this is exactly what followed. Everybody out there thought that we have an early peak in 2024. That means no bull cycle in 2025 and no more four-year cycle. Again, what is the four-year cycle? Everyone who speaks about cycles, almost everyone kind of always get the cycles wrong. The cycles are measured from bottom to bottom, not from top to top. 2013, we had a November top. 2017, a December top. 2021, an April top. This was actually a corrective movement that got all people as you saw in the first post. All the people back here got it wrong because from here they thought that this is actually a bullish structure that have taken the last all-time highs as support and we are going to 200k. Remember those posts, remember those people because they are now calling for 2022 to happen exactly the same. The same exact people and I'm going to show you why. But also remember this cycles are measured from bottom to bottom not from top to top. That's why here everybody got it wrong. Also me because I was a beginner and I was watching all these guys get sucked in by the euphoria by the lengthening cycle super cycle. Prices just continue to move up into 2022 and this was the main reason why because from June into the summer we got some weakness on Bitcoin just like in uh 2021 with the final low into July looking something like this. And all of these guys were putting out this fractal from one cycle before and they all came with the same exact conclusion. Bro, the four-year cycle always stops in December. So look here how this nice fractal from July just as 2017. The same exact thing. We had a pivot low in July and this was the actual chart mimicking all the strength and the weakness that follow through. And also here with the pick that everyone thought that this is just another retest using their basic TA from which Bitcoin should have a blowoff top into look here the 200K target before the cycle was over. But again cycles are measured from bottom to bottom and everyone here was wrongfooted.
And in my opinion it is exactly the same as now. Everyone here basically all these guys that were calling for 200k Bitcoin back then are posting this fractal right here. Yes, Bitcoin would go to 45K and from here the market makers would just give us the opportunity to short the hell out of Bitcoin and all make money. Maybe putting those market makers into bankruptcy. So that is why I want to discount with 100% probability this scenario alone.
Now what scenarios do I have for Bitcoin? First of all, if you remember 160Kish, it can be below or over it, but in my opinion, this should be targeted before the breakdown should start. Now, this should happen going into January and maybe we stay there also in February, but from then the next window of seasonality is weakness until April or the start of April and the drop can be significant. So basically invalidating all these guys that are calling for another bare market copy pasted from 2022. This would make them come back tail between their legs just begging us to welcome them back into the bull market. So basically a huge sentiment shift just like here. This continues to be my main scenario and then this could continue with another shape and form than the 2022 bare market. So if we do have a blowoff top like this, the next dump should be more than 35%. In my opinion, whatever comes next is dependent on this to happen.
The second scenario is still not a copy paste from here. The second scenario could be a copy paste from here. And why is that? During Bitcoin's entire history, we only faced this scenario one time in the past. Meaning after the rate cuts or let's say after some rate cuts because uh here it wasn't the same during these rate cuts, we had an uptrend and from here during these rate cuts we had a downtrend. Now it could be in another scenario that they are keeping the rates paused and why is that? Because of the recession real recession indicators remember the delta we've talked about for them to cut 25 basis points the US 3 month should be here. So basically it should go here until the FOMC or maybe during this time if the US 3 month does not leave this area at 375 basis points the delta is becoming zero if they cut and they do not want it. We are at 4%, the 3 month is at 375. During this entire paused era of rates, the US 3 month was holding at 425 basis points and the Fed didn't cut for many months because they did not have to. And they maintained that delta of 25 basis pointsish. 450 over 425. This is the difference, the delta. Now it is the same. So basically going back to our uh Bitcoin chart, if this is the case again and we have a December pause just like then and another January pause just like then that could be also the case for Bitcoin. Here the yields remained in the same range and the Fed just like now held the rates with a healthy delta. This was the first pause and in January at the end another. What did Bitcoin do? Let's see. Just a 65% rally. Just remember if this is the case for Bitcoin right now, I'm not saying that we should pump 65% for Bitcoin. I'm just saying that the chart from 2022 is irrelevant in this environment. So, we could also have something like this and maybe we do not touch the 160 area. Maybe we just grab the liquidity over here or just stop something like 120. And if we are in January, maybe crossing to February, and we cannot go higher, this would be my second scenario, my least probable one that the top was already in. I'm selling what I have left from my Bitcoin stash because we probably could see something nasty from March to April to May. Maybe the yields are coming down hard and we induce the panic cuts. Let's see what the percentage of growth could be. 55 a 65 would mean Bitcoin at 132K.
Now in this scenario, let's think about it from a psychological perspective on the market. Everyone who has invested in shitcoins from here to here and everyone I know told me exactly the same thing. When Bitcoin drops into the bare market, I'm going to buy it with two hands. I'm going to sell my house and get Bitcoin and I would not touch shitcoins. Have you heard this? Have you felt it maybe? Because I heard it all over the place. Why? Shitcoins underperformed at least the majority of them. So basically everyone right now wants the same thing. They want to end as fast as we can and get Bitcoin and just chill for the next four years. But unfortunately things do not play out like this in the market. Market participants do not get what they want because the market doesn't owe them anything. So that's why in my opinion this scenario is off the table for now.
So first if we have a blowoff top going into January maybe we see 200k. I don't know. Everyone was forced to say I'm sorry right here because this didn't happen and we are on a verge of a super cycle, a lengthening cycle and this time is different. The four-year cycle is over and everyone wants to be a part of the new bull market and the rug is pulled very hard into April. This remains my main scenario because the market always wrongfoots the majority of its participants and the very few of them who are ready for the most amazing or annoying or least probable scenarios are the ones that win. And again, maybe then the drop is so big is so big that everyone forgets that they need to buy Bitcoin because 85% drop on Bitcoin never happened before. Volatility was supposed to come down over the years, mostly because now we have the institutions. But again, if you watched my other clips, you know I'm expecting a 40% discount on the S&P. Yes, you heard it right. I'm expecting the next drop to be twice as fast and as hard than the one in April. Maybe it happens into April, into May, or maybe we prolong this market into March and April and then the actual drop really comes at the second half of 2026. But I don't see how we don't take the liquidity below this low in April. Maybe even lower.
So in this kind of environment, I have two thoughts on Bitcoin scenarios. If this happens on the S&P, just imagine when this happened on the S&P, 25% minus what happened with Bitcoin in that bare market that everyone seems to long for now. On a 25% discount on the S&P, Bitcoin had a 77% discount. Imagine the S&P minus 40%. Imagine how Bitcoin's discount could look like. So basically this is my first scenario. If this happens and a big blowoff top is coming into the start of next year, wrongfooting all the market participants again. Even the most famous bears right now would have to capitulate, would have to ask for our permission to get back into the bull market. And if this happens, we dump on their heads because most probably this happens next.
Another scenario of mine which is least probable but I should take it into consideration and this idea got to me because uh when I saw this drop right here comparing this with the S&P let's uh look on it 32% discount while the S&P corrected hard and fast and we know that Bitcoin has uh its hard corrections that is Bitcoin's feature not bug feature because that's how you grow your wealth. You need big volatility. So, Bitcoin minus 32% and this had a minus 22%. So, the minus between them was very very small. You saw how in the 2022 bare market the S&P had a 27% discount and Bitcoin a 77. Through that same logic here, Bitcoin should have had something like 55% discount but only had a 32%. So my other scenario is correlated with the other time in history when uh Bitcoin suffered from rate cuts or rate pauses.
Another scenario for Bitcoin could be something like this. Basically a corrective structure going into the cycle bottom of 2026 with every market participant not knowing when to buy Bitcoin because the price is just ranging and not doing much. And comparing what happened here for Bitcoin versus the S&P. If the S&P in this case has a 40% discount, a translation with what happened in March, Bitcoin could have something like a 54% max draw down into the cycle end. And I guess people would just not buy Bitcoin here because the price is too high and everyone would expect Bitcoin to go something like 30K or 40K, which is a good target in my opinion also for a bare market low. But if this morphs into a more complex structure like this, just ranging, just baiting everyone, just taking their money, which the market makers already did. I know that most traders on Twitter told you that these ranges are perfect for traders, but you just need to remember that 99% of the traders are not profitable long-term. So basically, this is not a trader paradise. This is a market makers paradise. Also, this again not my main scenario, but I need to keep it in the back of my head. If I see something like this developing going into January, seeing that Bitcoin has no strength, then completing the weak seasonality until the end of March, the start of April, then going back up again, baiting everyone, going for the highs again, doing something like this again, just taking the money from every trader you know, and get into the cycle lows while everyone awaits this to happen. the big drop just like in 2022, just like in 2018, 2014, etc. And that never happens again. Not my main scenario, but I should take it into consideration because I do want to know when to buy Bitcoin next because I sold the majority of my Bitcoin. I only have 40% left. I did carry it from around here.
And now for the altcoin discussion. Even if Bitcoin has its blowoff top, which is my main scenario, which should gather up some more liquidity, and the Bitcoin dominance may be having another rally to the upside, sucking that liquidity, I still expect that into January, maybe February, maybe the start of March, the Bitcoin dominance should drop in this area right here at 43%ish. So basically, it doesn't matter if Bitcoin does this or it does this. This needs to happen. I saw a lot of big accounts just like those one that I mentioned at the start of this clip saying that in this season the Bitcoin dominance should not even drop to complete the cycle. But that is Every time the cycle is ending, this has to drop. If not, it is pure and simple. If not, then Bitcoin should really be in a super cycle. So if Bitcoin dominance holds this trend just like this, that would mean for Bitcoin that it has to continue its growth throughout 2026. and I should remain long and strong with the Bitcoin I have left and maybe this comes something like the end of 2026 which makes no sense for me. I want to be vigilant because uh as explained if we have a drop in dominance into the start of September then the next window of seasonality is up until November December. It is the case right now and if this is the case then from December the next seasonality window for the Bitcoin dominance is down and not just any down hard. And if this happens and Bitcoin goes to 160 or maybe 130 or maybe just 120, which is the other case for Bitcoin, it doesn't matter for our altcoins. Of course, not for all of them, but this would mean that all tides are rising. It would not just be some privacy coin or maybe two or three coins on another narrative pumping up. It would be most of the coins. And when we get here, that's when I am 80% out of the market. Right now, I'm only 20%. I'm waiting for this to happen to signal to me that the cycle is really over and I need to prepare with the biggest bag of cash for the next cycle. That is my play. That has continued to be my play since 2022 right here.
Again, see the whole bunch of clips on my YouTube channel because there are not a lot. You can binge watch them in something like 2 or 3 hours. And of course, you can grab that subscribe button, smash it over its head. And if you want more updates like this, more in-depth, more charts, we also have a Discord channel. I suggest you go to the gameofliquidity.com, check out the presentation on the website, check out my track record and decide if you want to join. And if not, just wait for my next clip. Or you can go subscribe to my free newsletter that comes something like 2 or 3 days apart. Other than that, I hope this video helped you and I'll see you on the next one. Cheers.