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I've been receiving a lot of questions lately about Bitcoin and whether the Trading with the Time Factor techniques also work with the crypto currency markets.
Well the short answer is both "yes" and "no".
One of the limitations with crypto is that is that it has a very limited life span - Bitcoin itself was only invested in 2008 so has not yet had a lifespan of 20 years. This makes it impossible to use any long term cycles to forecast prices.
On the flip side, Bitcoin trades on a 24/7 basis, so the pricing information is dynamic and the short term time cycles can be used to effectively to help forecast short term turning points in the crypto set.
The example below highlights how the trading to Time technique described in volume 2 of Trading with the Time Factor applies very easily (and successfully) to the Bitcoin market.
It's pretty amazing to see how many significant turning points occur in Bitcoin around the 28th-29th of each month.
If you go back and take a look at the turning points made on the 5th-6th of each month as well, you will find equally impressive results.
Going forward however, I would be turning my attention to the 17th-20th of the month for future turns. The reason for this is relatively simple. The two recent highs in Bitcoin above US $100,000 occurred on 17 December and 20 January. They are the first two reference points I would begin to look at to determine future changes in trend in BTC.
(refer to the purple indicators in the chart below)
Now, whilst 17 December is important, it does appear that Bitcoin is working its way to synch itself to the 20-21st of each month. The recent top on 21 February gives us the indicator that this time period each month is working to the BTC market.
Projecting forward, 90 degrees from the 17 December high takes us to around 17 March 2025. That would be the first obvious place to look for a significant change of trend off such a significant date.
Next, I would be paying attention to the 20th/21st of April which is 90 degrees off the 20 Jan high, and approximately 120 degrees off the Dec top.
Lastly, its pretty amazing to see how the price resistance levels on Bitcoin work so spectacularly. The chart below shows how the recent move in Bitcoin found resistance almost exactly on the major 50% retracement level. Any further weakness in Bitcoin will test itself if the levels at 79,000 get broken, with 72,200 being the next key resistance zone.
Now, this is not a prediction (as I simply do not follow the crypto markets closely enough), but if we had prices reach around 72,200 on either 17th/18th March or 20th/21st April, then that (to me) gives me a pretty good signal to expect a potential change in trend.
This is how we start putting the pieces of the jigsaw puzzle together.
Until next time...