Bitcoin faced rejection at $100k and has begun its descent to the cycle low. In about a week, Bitcoin is expected to hit a 1-day cycle low, mark the 60-day cycle low, and rebound sharply to the upside. That’s when we plan to enter a trade. 🧑✈️
If this sounds confusing, stick around. ⬆️ We’re focusing on identifying bottoms and answering the key question: How do you find an actual bottom? 😕
To identify bottoms, we use cycle indicators. For the best results, we ensure that three key factors align:
- Bitcoin is either at the end of its 60-day cycle or the start of a new one. 😮💨
- The 1-week or 3-day cycle is below 20 and about to reverse. 🆙
- The 1-day cycle is also below 20. 👆️
While these conditions improve your chances, they don’t guarantee you’ll hit the bottom. 🫣 Let’s explore the AVAX/BTC chart from June 2021 as an example:
How to find the best possible entries (the one on the left)?
To pinpoint the best possible entry in the dark green zone (on the left), we need to analyze the same chart on a smaller timeframe, such as one hour. 😊
On the chart, you’ll see five different indicators, which might seem overwhelming at first. However, all these lines are the same Cycle indicator applied to different timeframes:
- Dark Blue Line: One-hour cycle 🔵
- Violet Line: Two-hour cycle 🟣
- Light Blue Line: Four-hour cycle 🟦
- Green Line: Eight-hour cycle 🟢
- Last Line (Orange): Twelve-hour cycle 🟠
These cycles help us identify a pico bottom. The buying condition is met when all five cycles drop below 20, and the Nadaraya (or moving average) shifts from red to green. 🤙
An alternative condition is to wait for the 2-hour cycle to start rising before entering a position. 👀
By following either of these conditions, you’re almost guaranteed to buy near the bottom. 🍾
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Back to the roots: Bitcoin 🪙
As predicted in the previous newsletter, Bitcoin was rejected at $100k and is now approaching a cycle low. ⏬
The answer is clear: we’re not at the bottom yet, and it’s not time to buy. The 1-day indicator (dark blue line 🔵 ) is currently at 68 and looks poised to reverse to the downside, signaling a potential cycle break. Even if this doesn’t happen, the 1-day cycle will need about a week to return to the 20 range, marking Bitcoin’s 60-day cycle low. 🚗
The low could form anywhere between $85k and $91k. Remember, cycles don’t predict prices; they provide timing bands for tops and bottoms. 📆
Next Cycle Outlook
I don’t mean to sound pessimistic, but the upcoming 60-day Bitcoin cycle doesn’t look promising. 🥲 Here’s why:
1. We may need more time before the market reverses to the upside. ⌛️
2. The 1-week indicator spent a significant amount of time above 80 and is now trending downward. This cycle reflects the general trend for the next 1-2 months and currently leans bearish. ⭕️
Despite this, there are intriguing opportunities in the market right now. More details are available in the Premium group.
Stay safe, trust the cycles, and build your wealth.