BTC Market Analysis: July 12, 2018

As goes BTC, so goes the crypto market. My guestimate projecting forward is a seesaw behavior for the next crypto move. Yes, if at this point we see another break down to 6k, we are either headed for a crash, or a double-bottom. I think a fast retest to 6k is less likely. It is more likely we have a slow rally to the 7,000's, possibly 8k for a top and then another decline following this minor rally.

The final stages of capitulation is a tiring of the crypto market, wearing down the fortitude of investors and traders to stop monitoring the situation, and stop caring that much about what is happening with crypto. In many ways it is much, much worse than crashes. If you are good at trading, at least you can trade the bounces in a crash and make money. In the market doldrums of the after-math of crashes is when traders get bored and find other things which will have enough volatility to make them money.

And this capitulation of boredom is likely to be a monotonous one for investors. Then about that time we are completely unenthralled with what is going on with crypto, that is about the time the market will begin the new rally. We can only hope this happens by December. It may be next year at this point.

In my earlier stuff this year when the market began crashing, I was over-optimistic in how long this could take. My over-optimism was born from the idea that in 2018, crypto is a heck of a lot more interesting fundamentally than it was in 2015. I figured we would have a fast 10k bottom, investors and hedge funds swoop in the scoop up the long-term buying opportunity, supply gets sufficiently contracted and we are back off to the races... this is what I thought, clearly, I was wrong.

To get back off to the races, the market had to topple and hold the topple into the doldrums capitulation, likely where we are at now.

This type of capitulation is the greatest opportunity for investors long-term, it is also the most boring for those already invested going into it.

The Good News

The good news about the doldrums capitulation is that it produces the greatest, and safest subsequent rally. Had we had the fast bounce at 10k, and new highs above 20k, the market would be 100% untrustworthy. It could have formed a head and shoulders, it could have just made a steeper crash top. It would not have been a solid market to trust as a long-term bullish trend. It would have crashed on us at some other point, and likely still required these doldrums.

Once the doldrums set in, the market becomes trustworthy again, baring some cataclysmic event for Bitcoin. Meaning, when this type of trade/investment happens in crypto, we can generally trust the long-term accumulation price that the market has set for the bottom (maybe just under 6k). We can also then assume the next rallies which ensue in the re-establishment of a true bull market will happen over a slower pace at first, into a more aggressive pace in later-stages of the market. This type of new bull market should likely blow out the 20k BTC top with ease. If it does not, then we are in a 1980's Japanese stock market situation where it may never recover, but at least the 2nd top would give us a solid unloading point if that's what we found ourselves in.

I favor this was not the 1980's Japanese Stock Market, because a currency can hold 1 tril market cap. It is simple math. In which case when the re-established market comes, hedge funds, and large investors will see it for what it is and likely the 20k top gets left in the dust, BTC 50k to 100k following there after.