Bitcoin finds a very delicate moment, or half is approximately 10 days and the price has been making quite interesting movements that can be confused even by the most experienced of traders, as a value of US $ 1,000 that has undergone several resistances and several short settlements (even one of my highly leveraged positions, on occasions like the one that considers risk management to be one of the most important pillars in commerce). The study he plans to do today will bring a retrospective of the latest bitcoin events since the black swan and try to project possible situations that may occur in the coming days.
1 - Black Swan
Within the financial market, the expression 'Black Swan' is used to refer to events that are totally unpredictable, but have a high impact on the universe of finance.
On the 12th and 13th of March an event occurred that caused fear in the entire market, causing governments and entities from around the world to believe that we will enter a period of economic recession, as the financial market tends to price these events before they happen in reality. we saw the analysts leaving their positions en masse and creating a "herd effect" and liquidating numerous positions of various assets, even the so-called safe haven. Bitcoin, despite not being related to any government entity, fit into this scenario of global liquidity crisis having one of the worst casualties ever seen as it is used to finance positions of other traditional assets in the market.
For example: let's say I bought a $50,000 gold futures contract. I can, through my home broker, use this contract to finance a position in the stock market, if during this contract I end up having a loss in my trade the gold futures contract is used to cover the loss that my trade had.
When this global liquidity crisis happened, bitcoin contracts traded at CME were used to cover the loss of traditional assets, which in turn caused a price pump responsible for reversing the market sentiment bringing the disastrous result seen above.
It is also possible to note that despite having been a very characteristic movement and with a less mature market, this bearish sailing movement also happened in 2015 and preceded the biggest bull run that bitcoin has had so far.
2 - Graphical Analysis
I would like to comment on the possibility that I heard from some analysts about this global liquidity crisis having opened the way for all of this to become a very long-term corrective process. In my view, this is the least viable possibility given the characteristics of the super cycle, but it is not entirely disposable.
The big problem of a correct analysis about the bitcoin super cycle is the useful life that the graph presents us, the oldest data that we can analyze are from August 2010 which does not give scope to study a bearmarket period in the super cycle since there were none. So by studying the super cycles of the traditional market using the elliot wave theory with some indicators you can identify patterns that conflict with the theory and these indicators, it is currently not known if the patterns of the traditional financial market are valid for bitcoin.
Below I explain why I believe that we are still in a high characterization
The point that makes me believe that we continue in a bullish trend is this configuration in the monthly: the candle that paid a visit in the $3,900 house did not have enough strength to remain below the exponential moving average of 55 periods (yellow) and the following month did not find any resistance in the exponential moving average of 21 periods (green), what remains for us to know now is whether the monthly candle that will open tomorrow will test this EMA21 support that is currently plotted at $7400 and will be rejected with conviction for make room for a new high.
Bitcoin waves 2 tend to be a little deeper and waves 4 more lateralized, going back to 2010 and catching the first wave 2 on the weekly chart you can see that it has retreated to just over 89% of wave 1.
In the current cycle we can see that this happened again, mischaracterizing my previous count that said we were entering a wave 5 to end the 4-year cycle proposed in a previous study.
On the daily chart we have just broken the wedge formed by black swan together with the break with quite conviction of the 200-period moving average, giving us room to believe that this upward trend has been achieved, but we have a very important event coming up: halving.
Halving can make the market feeling extremely positive, causing a large number of people to bet on a high after that event and it is usually at this time when whales go against that positive feeling and end up paying off most of their bitcoins causing a price dump
In this April 21st CME report we see that most traders trading futures contracts are going short and, surprisingly, on this April 21st date the price touched the resistance of the wedge and started to rise to the level we are today .
As I said earlier in this study, the market tends to anticipate movements, so the traditional market, when noticing a possible recession that was wide open with the pandemic that is happening, generated a global liquidity crisis, bitcoin is possibly anticipating this herd movement that would be for coming given the halving and after it can come a bulltrap (not discarding a candle with a wick long enough to liquidate the short positions).
Thank you for reading :D