What goes up, must go down
This year was fenomenal for bitcoin, the amazing rise in price, and coinbase adding over a million users in a single month, did some great things for widespread adoption of bitcoin and blockchain overall. But what goes up, must go down. Here are the main reasons why I think btc will be in a bear trend in Q4/2017
The FUD ain't over
We have all witnessed the fall in price on September 14, part due to Jamie Dimon of JP Morgan and part due to rumors around China, the market was bleeding that day. Everybody knows that bitcoin is volatile, but I am sure that you didn't expect waking up that morning and seeing bitcoin down almost 1k$. Bitcoin is volatile, and people will always be people, they will panic sell. The dramatic fall in price tells us that the price of bitcoin is ready to go down in case of bad news. But China isn't over regulating bitcoin, they will bring in more regulations, and as soon as rumors get into western media people will start selling again.
Volume is low, and holidays are not even here
The end of the year traditionaly has low volume in most markets, it's the holiday season after all. But bitcoin was an exception in Q4/2016, it actually peaked volume in Q4/2016. But please take note of the distribution of volume, the majority of it was in china, some sources say upwards of 85% of the volume was in chinese major exchanges. History will not repeat it self this time.
Bitcoins current volume is among the lowest it has been, there isn't much demand currently and it all ties back down to the 1k$ crash a few days ago, think to your self, who would invest in something that has just crashed such a high amount, maybe you are a HODLER, but most people would be very sceptical of buying.
Segwit2x uncertainty
What is going to happen in November? Truth be told no one knows, and that means uncertainty. Uncertainty brings fear, and fear brings doubt. Uncertainty is stressful. But what’s not so obvious is that uncertainty is more stressful than predictable negative consequences. This lead to panic selling. Segwit2x is a hard fork, not a soft fork like Bitcoin Cash. This means there is no replay protection, and with people panic selling, all hell could break loose.
Tehnical analysis
Go and take a look at the charts, it looks like a head and shoulders pattern could form. This pattern is believed to be one of the most reliable trend reversal patterns. It is one of several top patterns that signal, with varying degrees of accuracy, that an upward trend is nearing its end. Technical analysis supplements my previous arguments.
Conclusion
Due to a high level of uncertainty I firmly believe bitcoin will be in a bear trend in Q4/2017. While I am optimistic about bitcoin longterm and believe in the tech behind it. I think it is time to short it.
Sources:
https://www.coindesk.com/459-million-bitcoins-exchange-volume-reached-peak-levels-q4/
https://www.theguardian.com/commentisfree/2016/apr/04/uncertainty-stressful-research-neuroscience
http://www.investopedia.com/terms/h/head-shoulders.asp
https://cointelegraph.com/news/bitcoin-user-base-surges-coinbase-adds-1-mln-users-in-1-month