The number and magnitude of callbacks are key? Currency Market Analysis 2021
Yesterday we analyzed that the big probability of this round of market development will be Bitcoin leading the trend, so we should focus on the trend of Bitcoin.
There are two trends in Bitcoin: one is a fast-moving “cow “, the other is a slow-moving” slow cow “. In these two trends, slow cattle is healthy, lasting, but also the trend we look forward to.
And the most important thing to get out of the slow cow is that the market must have enough and enough times of correction.
Let’s take history as a mirror and review the trend of Bitcoin in the last bull market.
The chart above shows Bitcoin from 2013 to January 2018, covering the peaks of the first two bull markets
On 4 December 2013, Bitcoin reached a peak of $1117 earlier in the previous bull market, Three years later, on January 5,2017, Bitcoin exceeds the peak of the previous bull market, To $1126, Completely opened up and out of the bull market for a year, In this bull market, Bitcoin peaked at $19244 on December 18,2017, The increase reached about 17 times.
According to this rule, Bitcoin officially broke through the peak of the previous bull market in December last year, completely opened up the upward space, and began to enter a new bull market. So we are undoubtedly in the bull market, but obviously in the early stages of the bull market.
In the above figure, I marked a number of segments with small horizontal lines. These movements are basically more than 20% of the correction. That is to say, in the last one-year bull market, Bitcoin has experienced at least five more than 20% correction before reaching its peak.
The correction in the bull market is very necessary for the healthy and sustainable development of the bull market. On the one hand, it is the consolidation and summary of the trend of the previous stage, on the other hand, it is also to accumulate strength and lay the foundation for the further development of the latter stage.
This callback is constantly consolidating the basis of the bull market, strengthening the upward trend of the market. So in the bull market, the more times of correction, the deeper the margin, the stronger the foundation of the bull market, to change the “bull “, the more difficult to suppress the” bull market “, the longer the bull market lasts.
Therefore, as investors, we should not only not be afraid of callback, but also get used to and like callback.
In the figure above, we can also find that Bitcoin experienced a longer and deeper adjustment in June 2017, and two more before June. Without such a big adjustment, Bitcoin will not be able to get out of the rainbow in the second half of 2017.
I believe this rule also applies to this market.
The last round of Bitcoin broke through 1 From $126 to $19244, it rose 17 times over a year. As a result of this achievement, on the one hand, the great contribution of Ethernet ICO, on the other hand, and this healthy callback is inseparable.
This round of market, without ICO stimulus, can only rely on Bitcoin’s own trend to drive the market development, so whether the correction is sufficient and significant is more important.
In my opinion, the key to the correction is in the first half of the year, which is why I wrote in yesterday’s article that how Bitcoin moves in this round is crucial in the first half of the year.
If there are no at least two small correction in the first half of the year, a big correction, but a straight rise like a mad cow, I’m afraid the market wo n’ t last. Bitcoin can reach a limited price —— up to $50,000 to $60,000.
If there is a deep and frequent correction in the first half of the year, the market will be very predictable, and it is possible to get out of the market for a year or more, and the price that Bitcoin can reach is likely to reach or even exceed $100000.
Based on this speculation, whether this round of market is “anxious cow” or “slow cow “, at least in the first half of the year we do not have to worry too much about the trend of the market, as long as we pay close attention to it, take the money in the stop, do not sell casually.
Here I would like to remind investors of two very taboo behavior in the bull market:
First, investors with coins in their hands, don’t see a good market rally for a period of time, guess there will be a correction, then sell their coins smartly, dream of a callback, and then pick up chips at a low price. It will only lead us to lose our precious chips —— pick up sesame and lose watermelon.
Second, do not see the market or rise or fall for a period of time, think that there has been a certain range, smart think that the market will immediately reverse, and then leverage, futures, this idea is the main reason for the bull market to die.