Bitcoin is in a wedge pattern. Longer than we think. In this chart it shows the trading range Bitcoin has been in since November:
It may not look good but this is healthy, as Bitcoin recovers from a massive run up from 3/2020 to 11/2021. It went from $3,800 to $69,000 in that time frame!
In the chart below, we can see halving circles in red, local top circles in blue, and cycle top circles in green. We still do not believe Bitcoin will see a permanent price run up and this is still a bull market cycle like in the past. Thus, a cycle top is eminent in 2022. We had always said in past blogs this bull market cycle would end in a cycle top either in late 2021 or early 2022. Now that year end is two days away. The cycle top will be lengthened out to sometime in the 1st QTR 2022. Maybe it gets pushed out to the second QTR. This is how we still see, and we understand many “experts” are moving over to the super cycle theory with Dan Held. We just see this as a lengthened cycle, but no super cycle. We are expecting a bear market later in 2022. Here is the chart below:
Below is a chart showing bullish divergence. A reversal in the chart is expected:
However, in order for Bitcoin to turn bullish the stochastic RSI cross happening now must complete and we need to see the weekly RSI get to 60 by the year end close, click here to view more.
In the above trading view chart we see the weekly RSI needs to reverse soon. That has not happened. Once it does, and the stochastic RSI cross to blue on top, red on bottom completes and gets above 20. The Bitcoin reversal will be complete. December was obviously not the bullish month we thought it would be but the patterns in the chart point that January still could be. Time will tell. See this chart below showing Fibonacci levels that have not yet been hit. Far above where the price sits now:
There is still time for a reversal early next year. For now, watch the RSI levels on Friday night. They need to go higher by midnight, Friday night. That would be a great start for 2022! These last 6 weeks of the year have been frustrating watching Bitcoin grind lower when everything looked bullish. Next year look for signs the Fed finds excuses NOT to raise rates when they said they would in the 1st QTR. If they do not, that could be a catalyst to push Bitcoin parabolic. Stay patient, buy the dip and don’t sell any Bitcoin!
Neutral ATM is here to get everyone off of zero Bitcoin.