BITCOIN When Parabolas break.. Are we in an early 2018 scenario?

16 thg 1, 2021

First of all let me start off by saying that I don't want to spook anybody with this post. You all know my long-term thesis on Bitcoin and how big of an enthusiastic investor I am. I just want to bring to the public the similarities of today and the late 2017/ early 2018 price action, in the whole context of the parabolic activity. Thus, I will keep it simple without much analysis as all I am interested it is to know your opinion about it.

** Comparison purposes **
To begin with, this comparison is between the 4H time-frame (today) and the 1D time-frame (2017/2018). I am stating this now in order to prevent the comments section to be flooded with "You are comparing different time-frames" comments. Yes they are different and this is why even if the current Parabola breaks, it doesn't mean that Bitcoin is doomed again (we get those comments pretty often when a decline occurs), as we'd still be within a Bull Cycle (in fact we are still at the beginning of the Greater Parabolic Phase, I've covered this aspect on previous studies) having a healthy correction. The purpose of this post is to compare the behavior of a Parabola and see which conditions can cause a breaking.


** 4H against 1D time-frame **
So, the left chart is on the 4H time-frame using the MA100 (blue trend-line) and the MA400 (orange trend-line), while the chart on the right is on the 1D time-frame using the MA50 (blue trend-line) and the MA200 (orange trend-line). I doubled the MA periods on the 4H chart as being lower than 1D we had to extend the length. Also it explains why there should be no worry, as the current Parabola (4H) is a mini sequence within a Bull Cycle, while the 2017 one (1D) was the last, most aggressive year of the Bull Cycle itself. The chart comparison had to be on an analogous basis (proportionate).

What this shows is that during the 2017 Parabola, the 1D MA50 was offering a fair entry level during the whole move (even when it broke), it got quickly bought back, while the 1D MA200 was never crossed, up until the Parabola broke. The break-out of the Parabola started by breaking a Triangle at the top downwards.

On the current Parabola, the 4H MA100 has also be offering a fair entry level, similar to the 1D MA50 of 2017, while the 4H MA400 hasn't been crossed yet (not since Oct 09, 2020 and the start of the Parabolic Move), similar to the 1D MA200 f 2017. The Triangle has also been formed but hasn't been broken yet upwards nor downwards.


** Conclusion **
So what do all these mean? One can argue using this comparison that if the Triangle breaks, then we have our local top and the Parabola ends. A 4H MA400 contact will simply confirm that later. However even in the event of a 4H MA400 contact (orange trend-line on the left chart), which would be roughly a -40% decline from the top around $25000, that would still be within the limits of "normal behavior" during a Bull Cycle, as I've analyzed in a previous study (see below):

But what do you think? Is the current Parabola similar to the 2017 one (analogically)? And if so, is it time to break and will a break-out from the Triangle confirm it? Feel free to share your work and let me know in the comments section!


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