In spite of everything, Bitcoin price is Down, now what?

Zoom out, and relax!  These prices could get into the upper $30K’s.  They could drop lower into the $30K’s.  It depends on which support level holds.  However, from a zoomed out decade view level.  Bitcoin is a max opportunity buy!  This price weighted by reserve risk is color coded, and green is max opportunity, red is max risk.  See this decade view chart below:
 

 

The most important thing to remember is zoom out and look at long term charts.  Here is a little more detail below.  These next three charts detail the gausian channel.  Whenever Bitcoin enters this channel it takes a year, on average, to get out of it.  The first chart shows the 2014 bear market, the next chart shows the 2018 bear market, and the black swan event of 2020 (the pandemic).  The final chart shows where Bitcoin is right now!  It has been rejected (last week), by the mid line of the gausian channel.  In the third chart below, notice the yellow box.  That is the zone where Bitcoin price is at it’s lowest, and is the best time to buy!  The opportunity zone.  Also, note (on the third chart) Bitcoin dropped into the gausian channel in May 2021.  It came out for October and Novmeber to hit $69K, but dropped back into it again!  Thus, mid next month, will be one year since Bitcoin became stuck in this channel. Here are the three charts from Steve Courtney:

 

 

 

The opportunity zone in the above chart starts in the mid $30K’s.  Bitcoin has already been there several times since November 2021.  In our opinion, Bitcoin does not need to drop far into this box.  We hope it does not.  Nor does it matter if you buy Bitcoin at $40K, or $32K, or $24K!  Longterm, Bitcoin will hit a peak north of $200K and further out, $1Million.  Buy and hold has been, and will remain our only investing policy for Bitcoin and Ethereum.  Although we continue to lessen our Ethereum exposure, and it may become 100% Bitcoin soon.  Ethereum is not decentralized, it has one owner, and scarcity is exponentially in Bitcoin’s favor, not Ethereum’s!  

 

Now, let’s look at global macro, which pushes investment into Bitcoin, LONGTERM!  De-dollarization has been going on a long time, but has really sped up into hyper speed over the last year.  Click here to read article.

 

Previous blogs have spoken ad nauseam about de-dollarization.  The US dollar will not be the global reserve currency forever.  Most likely, CBDC, central bank digital currency, will be rolled out as a replacement.  Canada and China are already doing that.  Remember, CBDC can be printed just as fiat currency is now.  Plus the central banks can tie bahavioral economics into them.  Like, booster shots, social credit scores, and green energy key indicators.  If your behavior is not what they want, access to the CBDC can be denied!  We KNOW this will be rejected by the people.  

 

Inflation is 7.9% according to CPI, while the 10 year rate is 0.8%.  The Fed is talking about a 50 bps rate hike in May, and perhaps 50 bps rate hike in June.  Expect 10 year rates to get to 2% to 2.5% and stop there.  Will that stop inflation in it’s tracks?  No.  See this chart below, thanks to Nic Bhatia for this chart and the next one:

 

 

This is 10 year treasury yields.  The trend line shows resistance at 2.47%.  Now let’s look at the 30 year treasury yields:
 

 

This trend line shows resistance for 30 year treasury yields at 2.555%.  Getting 10 year, and 30 year yields to these levels, will likely kick off the beginning of a recession.  Fall 2022 to fall 2023 would be the likely time frame when this recession starts.  How will Bitcoin respond?  We don’t know yet.  Right now, we just want to see a bottom formed and a recovery generated.  Bitcoin has not reached anywhere close to the $29K or $33K bottoms of June 2021 and January 2022.  We hope price does not go there.  So far, the low of this dump was this morning at $40,530.  Zoom out, look long term.  It appears Bitcoin could at some point, get into the $30K’s again.  Unfortunately.  That is a good buying zone.  We are looking long term.  Keep reminding yourself of that!  This is not financial advice and we are not financial advisors.  This year has been a tough one for Bitcoin and it is only April!  All of the global macro indicators, and investor’s buying up Bitcoin, indicate it will reverse.  So far, that has not happened…..yet!

 

Neutral ATM is here to get everyone off of zero Bitcoin.

 

Give Neutral ATM a try.  We have low rates, convenient locations and we are expanding. Contact Neutral ATM, we will answer all your questions about Bitcoin and using our ATM machines. Find a Neutral ATM Bitcoin machine location near you.