Crytpocurrency Bull or Bear and why you shouldn’t care. The Bitcoin halving event has come and gone without much price action. Actually, Bitcoin's 30 Day volatility range is near historic lows. Which simply means, it’s day to day overall movement is near the lowest it has ever been. I believe upcoming price action will lead to further pricing discovery.
Historically, after halving events we have witnessed similar price movements. A long period of consolidation and/or decline followed by a parabolic move higher. The chart below does a nice job demonstrating the float available following a halving event and the subsequent price moves.
Now what does this all mean? Bitcoin purists have been all over the internet counting the minutes to the next spike higher. The above chart suggests that we can see $100,000 per coin sometime around mid-2021. I would caution against a 10x return expectation in less than a year. Crypto currencies in general still trade like risk assets. Hence why we had the large sell off during the first rolling COVID shutdown. That said, Bitcoin has been in a very tight range bumping up against a massive historical trendline. For the non technical people, bitcoin has been mapping out an enormous 30+ month symmetrical triangle formation on the monthly chart. Probabilities favor this to be a continuation pattern. Stockcharts has a good explanation here.
In the Short Run, Bitcoin is also exhibiting a consolidating pennant pattern . A consolidation pattern with probability leaning towards continuing the previous advance.
The largest altcoin, Ethereum, is also demonstrating the same pattern in an even tighter range.
For a trading opportunity I am willing to take a shot on the Long side of ETH. I am fully prepared in a risk off environment for both patterns to break down, so will put tight stops. Given the normal volatility and risk of the crypto universe, we will take a smaller than normal position. Note that a move to ~$5500 in Bitcoin still keeps the bullish Symmetrical Triangle intact. Expect large volatility ahead.
Buy .75% Position ETH @ 235.75. 50-Period moving average is ~$225. Will use that as a stop. Initial Price Target $280. 4:1 Initial Risk Reward.