Good day Hiveians!
Join me in analyzing the crypto markets!
Looking at the markets on the macro scale
We are more or less all familiar with the idea of bull and bear markets. In a bull market prices go up, in a bear market prices go down. This is also occurring on a macro scale. In other words, the time frame in question is covering at least years (if not decades). For Bitcoin we have seen a close correlation to the halving events that happen every 4 years. In the middle of those events the market reaches its peak (the bull market top) and then descends in a sea of red only to regain those losses in the years after. The vertical lines are the halving events:
The phases are getting longer
If you look at the chart more closely you will see that the oscillation of the crypto market (it is still very closely linked to BTC) seems to be getting wider. The idea here is that every peak will take longer to play out. One way of looking at this is that the higher the prices climb, the more money it takes to move the market. This takes longer because larger sums of money take longer to shift around.
The peaks are getting shorter
Another point is that the peaks of every bull market are getting less pronounced. While there was stunning ~100,000% increase in the first bull run, the second was at around 40,000%, the third at 13,000% and now the fourth will probably be at around 5,000-7,000%. Every time it is getting exponentially lower.
The subwaves are getting larger
If you look at the right side of the chart you will notice that the two subwaves between the peaks are much larger than the ones on the left side. Larger both in height and width. To me this indicates that the subwaves and bull and bear cycles are beginning to take on more similar characteristics.
What could this be pointing to?
I think we could see the crypto market changing in a fundamental way. Instead of major bear and bull cycles we could instead be seeing waves of similar length and height. The last major peak as well as the two subwaves after it are all quite similar: they range between 450 and 700 days; they have a large impulse waves between 400% and 2000% price gains and large losses of 70-80%.
My thery is this: main waves and subwaves will continue to merge resulting in a more stable price environment stretched within a similar time frame.
This could mean that in 5 or 10 years from now, Bitcoin as well as other coins will become less volatile and therefore more "stable". It will probably take another wave for bitcoin to reach $1 million and a correction to perhaps a fourth of that. It is quite possible that it will "stabilize" around such a high value.
It could also mean that bitcoin due to its capped supply could further lose dominance and other coins will affect the crypto market to a much greater degree. If e.g., Ethereum becomes the #1 coin it will affect bitcoin and therefore the entire market. Other coins could also rise up and all of them could start to make much greater ripples in the entire crypto market which I think could mean more distortion that, however, leads to a more stable environment at large.
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!
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