The Tail Whip in Bitcoin (Part 2) \ stacker news ~bitcoin

так просто о сложном ещё ни кто не писал. возможно это будет их последний поворот ручки до упора. биткоин так будет рости по экспоненте несколько лет... минуя цикл падения и халвинга. значит это последняя рогатка к новой фин системе... я все понял. спасибо тебе человек.

You can find Part 1 here

We don’t have to dig too far into our memory banks to find the ne plus ultra of tail whips in the bitcoin market, as it just happened back on March 12, 2020. The Covid shock wave.

That was an 8-sigma move in fear generation. 8 standard deviations away from normal, something deemed impossible by every statistical practitioner. For perspective, a measly 5-sigma move is only supposed to happen 1 day every 13,982 years.

So an 8-sigma drop should happen approximately……never ever in the known universe. Once every 6.43 trillion years. But it happened. In bitcoin, of course.

It was also a tail whip to the downside, which became the direct precursor to a massive bull market.

Notice the same structure to the current tail whip, in more exaggerated form. First the move up, followed by the waterfall drop for one final nasty, stinging slash of the bear market propagation line.

At the risk of mixing metaphors, a tail whip to the downside can also be flipped around and reconstrued as a slingshot to the upside. Or more precisely, it’s like stretching a rubber band back before a slingshot launch.

With a slingshot move up, there is sensitivity to initial conditions. The amount the slingshot is pulled back has an effect on the subsequent trajectory.

In March 2020 the markets rallied furiously off the covid low, which was a natural and expected occurrence after such an unprecedented drop. The rubber band was really stretched back.

This should give this upside move plenty of staying power – 24 months to the upside – but it is likely to take some time to really get flying to the upside. I’ll have more on this trajectory in upcoming posts.

Of course all of my speculative talk about these putative gains has to materialize in the real world, with the bitcoin market responding to the upside over the upcoming period.

It’s important now for the bitcoin price to reverse into late November and turn this currently nasty looking red monthly candle into a “wick down” reversal and the expected slingshot up.

There are some additional compelling timing factors to this mid-November period as a major reversal point. More specifically this low is happening right at one of the 4 important energy peaks of the year.

But the empirical evidence on these energy peaks and polarity flips, marked on the chart below, should speak for itself.

Of the 4 energy peaks – February, May, August, and November – the November peak is the strongest. It tends to have the greatest effect on the markets. This frequently results in strong trends in bitcoin at the end of the calendar year, in late November and December.

The precise timing of this November energy peak is this week, exactly coinciding with the tail whip and this current waffling, uncertain aftermath. I believe this is very significant.

There is also the Fed to throw in this mix for a November low. My god….the Fed. What a disaster.

Rarely is there one chart that succinctly sums up a macroeconomic situation, but we’ve got one right now.

This chart is a very good proxy for the interest payments on the US national debt. (I didn’t come up with it, so thank you to @ThHappyHawaiian on Twitter for posting the original).

The Fed has jacked up interest payments way, way beyond the sensible bounded upper limit.

They are so far into triggering the doom loop they are never coming back.

What does that mean?

It’s pretty obvious to me -- and I’ve been forced, against my will, to study the Fed for a long time – that they will soon have to go back to one of the 2 knobs that they can control and dial up the liquidity in a big way.

That liquidity is rocket fuel for bitcoin.

I don’t want to get too bogged down with Fed talk, because it’s boring and they are on the way to being irrelevant, and I hate everything about them and everything they represent and stand for, as well as their tactics of disinformation and manipulation.

But unfortunately they still have their hands on 2 monetary knobs that they dial up and down, and these do have an effect on bitcoin. Bitcoin is a trading pair with the US Dollar, and they definitely have effects on the dollar.

They have the interest rate knob, and the liquidity knob.

That’s it. It’s not that complicated.

The interest rate knob is the one everybody gets fired up about it, but in my opinion it’s largely irrelevant at this point.

I’m going to leave it there for now, as my wife and our amazing Bernese mountain dog named Fred are waiting for me to go on a walk on this lovely day and I really need to push back from the screens and get outside.

We’ll pick this up again in Part 3 in a few days. The stuff about the Fed is, unfortunately, important and worth contemplating for a few moments, so I'll come back to it.