Market report

THE CONTEXT OF THE BEAR CONTEST

London Block Exchange

5th April 2018

What lies beyond yesterday's powerful feline pattern.

THE CONTEXT OF THE BEAR CONTEST

What lies beyond yesterday's powerful feline pattern.

The current need for a further drop in the price of bitcoin and the majority of cryptoassets is something most permabulls have a hard time realising. Overcoming that cognitive dissonance is key to survival - and even profit from - in this ongoing bearish market. That's why we shared the 'three cats and a moon' pattern, which is similar to the popular 'psychology of a market cycle cheat sheet'. 

Let's dive a little deeper. The comical yet serious pattern has only been invalidated during the epic bull run of 2017. That was the only year besides 2013 in which bitcoin didn't face any 'quarterly loss'. However, last year acted as a great reflection of the psychology of crypto traders. Who didn't know that humour was a great reflection of reality?

As we compare the current bitcoin chart with the pattern,  what's visible is that we are approaching the lower end of the dead cat wedge on bitcoin's average price among certain key exchanges. This is better called a 'large symmetrical triangle,' which has already broken down on Bitfinex, the highest volume bitcoin exchange. Keep reading - no reason for alarm.

THERE WILL BE A BOTTOM

We can put our hands in the fire as cryptoassets are here to stay.

One thing all bulls, bears and other key figures in the industry are 100% convinced and agree on is that cryptoassets and blockchain technology are here to stay. This means that there will be a bottom. If the technology keeps improving and fuelling adoption, then the bounce will be similar to previous ones. Check out this video that was shared yesterday, if you haven't already. 

Over the next few days it will become clear if bitcoin is looking to establish a new bottom further south of £4.3k ($6k) or if the consolidation will remain in this area. Since January we've been advocating a calm, 'move slowly' approach. Warren Buffet said, markets are a "device for transferring money from the impatient to the patient".

Momentarily, testing the theoretical bottom advanced by some researchers based on Metcalfe’s Law - around £1.4k ($2k) - seems highly unlikely. Yet, only a crystal ball could argue that precisely. Thus, let's find some comfort in the fact that the real bottom will only take place when "we are no longer focusing on price".

WHAT TO LOOK OUT FOR

Filter the noise and stay ahead of the pack

WHAT TO READ TODAY

An insight a day could give you more profits to play

  • bitcoin
  • bitfinex
  • warren buffet
  • tron
  • verge
  • mt. gox
  • asic