What if the current bitcoin price represents a return to the mean?
Some think bitcoin is extremely undervalued currently, while others think it is extremely overvalued, I guess it just depends on what camp you find yourself in going forward.
There is the camp that thinks bitcoin will eventually take a large chunk of the current gold market, even just taking something like 10% of the gold market would mean bitcoin prices would still need to go up 5-6x from here.
Then there is the camp that thinks bitcoin will either be replaced, outlawed, or just whither on the vine and die.
And as you might have guessed, there is quite a wide range in between those two.
Excluding all of that, the charts are possibly telling us something quite interesting right now...
We are likely very familiar with the phases of a bubble chart.
It looks something like this:
(Source:
)https://twitter.com/ByzGeneral/status/1182650984323002370
- ByzGeneral
Unfortunately for us, we are likely too familiar with this chart as it looks almost exactly like bitcoin's price chart from 2016-2018.
However, if that return to the mean line were to continue on bitcoin's chart it actually gets very interesting...
It's starting to look interesting...
What if the current price action is the start of the next bubble phase?
What if the big move up from $3k to $14k was the start of the "take off phase" and this recent pull back was the first bear trap?
You know, something like this:
(Source:
)https://twitter.com/ByzGeneral/status/1182650984323002370
- ByzGeneral
If that is indeed the case, then the next 18 months or so would be very interesting for the price of bitcoin.
There is no guarantee that is how things will play out, but there is no denying the setup is there.
What we actually end up doing from here remains a mystery, but the good news is that we won't have to wait long to see if things play out like this or not.
Sure would be nice to see another nice big fat bubble chart again. :)
Stay informed my friends.
-Doc