Bitcoin fees - we’re peaking - Journey to $2.5k begins

Тема в разделе "English", создана пользователем Trading Ideas, 11 авг 2020.

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    Bitcoin fees - we’re peaking - Journey to $2.5k begins
    Bitcoin / Dollar GEMINI:BTCUSD
    Full disclosure - I’m a BTC long term holder. Generally I’m long, but not today. Why $2.5k? Because that’s what the chart is suggesting. This trade is invalid if price action remains above $9.7k by September 10th. See point (3).

    1) Fees - peaks in fees always seem to converge with market extremes. Fees only go downward following overbought or oversold conditions are realised. Currently we are overbought suggesting a large trend change is in the post. Historical examples:

    August 11th, 2020 - $5.50 BTC @ $3k melt up to 12k

    May 20th, 2020 - $6.50 - BTC @ $9k then melt up to $12k

    June 27th, 2019 - $6.50 BTC @ $14k then collapse to $7k

    June 20th, 2018 - $6.80 BTC @ $6k to $8k

    December 22nd, 2017 - $55 per transaction! BTC @ $19k to $6k

    Point is, higher fees always proceed extreme movement in price action.

    2) Fear & Greed index - ‘Extreme Greed’ - 84 as of today

    This is a flashing indicator. We should be fearful. This is not ‘go long’ moment.

    3) 6-day chart / September 10th.

    No one seems to be talking about this chart. Why September 10th? I scan through various time scales looking for significant points of support and resistance .

    Over history of Bitcoin one single trend line has always been respected. It is indicated by the callout in the chart above. You can extend it back all the way to 2011 and find support & resistance .

    Should this trend line fail it would be a first in the history of Bitcoin . I cannot emphasise enough how important it is. Watch it like a hawk.

    4) DeFi BTC tied up in WBTC

    The amount of BTC in the exchanges as of now is less that WBTC (WBTC - Wrapped BTC ) trapped on the Ethereum network used as collateral within this massive DeFi bubble. That bubble is about to burst releasing untold quantities of BTC .

    5) Bitcoin has never seen a recession.

    I feel Youtube is full of moon boys at the present time. While I’d love nothing more that BTC to go to the moon, I must not ignore the facts of the chart and events in the world. We’re in a recession yet we would not know it. Why? Because governments are propping up failed businesses with new cash. When those unviable businesses are allowed to fail, the precious metals tank. That’ll be the true start of the recession. BTC will tank at the same time.

    6) S&P 500 / Eur Usd pairing

    BTC price action is hopelessly mirroring stock market price action. There is no independent price discovery in Bitcoin right now. The US FED is calling the shots and until there is a decoupling between those markets there’ll be no new high in BTC .

    7) Deflation.

    It is my belief we’re about to have a period of massive deflation. I’ve lost count of the number of times I’ve heard inflation is coming because of all the money printing.

    Truth is, not a signal note was printed. It is all electronic money on the FED balance sheet . Did you know the balance sheet is now shrinking? That’s right, the FED is pressing the delete button just as easily as they pressed the virtual print button.

    You can see for yourself at the link below, dropped by $0.25 trillion since June.

    The Main reason I believe deflation is coming is down to the matter of money velocity. There is none. For example, take unemployment - we’ve reached record levels - now what? This what:

    a) Unemployment + wages cuts

    b) Lower demand for products & services because of lower prices as people have less money to spend

    c) Over supply + lower demand

    d) Decrease in profits

    e) Business closures

    The result? Massive deflation. Compare any historical chart of gold during periods of deflation - not good. Same will hold true for Bitcoin .

    8) Dollar index

    Below is a 10-day chart of the dollar index . It prints a new candle tomorrow. In case you are not familiar, wiki says:

    “The U.S. Dollar Index is an index of the value of the United States dollar relative to a basket of foreign currencies, often referred to as a basket of U.S. trade partners' currencies. The Index goes up when the U.S. dollar gains "strength" when compared to other currencies.”

    As you can see from the chart dollar demand is about to spike up. When that happens, people sell anything and everything to get their hands on dollars. It seems ironic that we could be facing the mother of all credit crunches despite having ‘printed’ so much. Hey ho.

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