In my post of a little over a week ago which I entitled ‘Bitcoin et al….look out below’ and to the annoyance of many crypto fans, I suggested that the price of Bitcoin was set to collapse once the technical support region at $10,000 had been taken out.
As expected this has duly occurred with Bitcoin now trading well below this level at $8,603 at the time of writing, but this is just the beginning with far more dramatic moves to come as this cryptocurrency, along with all the others, finds more natural levels of value in the single and double digit price areas. No doubt this will leave many very different emotions. A few of the early adopters will have made vast profits, whilst those traders and investors who jumped in late on FOMO (the fear of missing out) will now be regretting their decision, living in hope of a recovery to exit at breakeven, or more likely facing a rapidly increasing loss as they are now caught in the headlights of indecision. For those who have stood on the sidelines, and now watching this collapse must be relieved this decision is being vindicated, and perhaps even feeling a degree of schadenfreude.
A salutary lesson, and one which will no doubt be repeated in the future, as our memories are always short, and we soon move on to the next mania or market which promises untold riches.
However, this is not to decry the technology of blockchain which is here to stay. But for Bitcoin and many cryptos, prices are now set to fall driven by a variety of factors, not least the rising selling volumes coupled with the lack of buying volume, which in this market of supply and demand dictates everything.
So where next for Bitcoin? And the major technical support levels suggest a pause at $4,482, followed by $2,779 and finally down to the $1,000 region. And once through this final level we then move back to three figures and ultimately to two or even single digit values.
By Anna Coulling
Chart kindly supplied by Trading View
Worst forecast ever. Idiots like you should stick to cooking and candle making. You have no clue about this space. Get out of cryptos until you have woken up and really see where and what cryptos are. Look back at this moronic assessment in two months and cry.
Hi DT – many thanks for your comment and whilst I enjoy cooking, candle making is not a pastime I have ever tried, so cannot really comment. As always it’s opinion that makes the world go round – you have one, and I have another. One of us will be proved correct in the longer term. It’s the same with two traders. One calls short and the other calls long. Thanks for taking the time to write- best wishes Anna
Hi ms Anna thanks for ur forecast on bitcoin. I really am enjoying your book and I am a fan for life. I would appreciate if you would send me a autograph copy of your newest book it will be a dream come true.
Hi Lisha – many thanks for your very kind comments which are much appreciated and I’m just so delighted you enjoy reading my market analysis. With regard to a signed copy I would love to arrange this for you, but as you can appreciate I do get asked for signed copies a great deal, and I’m afraid I can only do this in person. This is something I am always delighted to do at Meetup groups etc – so if you are in the UK or oner of my oveseas events, I would be happy to arrange this for you. Thanks once again and all best wishes – Anna
Bit my Bitcoin Anna! You are wrong again and you will see Bitcoin rise
past $64,000.00 by Sept.2018
Hi – Anything is possible and I hope it does if you are investing for the longer term – all best Anna
Make money on the way up. Make money on the way down.
I don;t see the problem.
Hi Boris
Many thanks and I completely agree – for traders and speculators this is simply another market which can be bought and sold like any other, and for Bitcoin on CFD’s or now on futures with both the CBOE and the CME. However, most in this market are investors who only benefit if the market rises and hence the rising tide of emotion as the market sells of once again, and looking increasingly bearish which is not what the majority want to hear. For traders like myself we simply do not care whether a market rises or falls – all we care about is being on the right side, and this applies to Bitcoin like any other – thanks for dropping by – all best Anna
Many thanks to your reasoned and rational Bitcoin insights. I can tell by the level of anger exhibited by many inexperienced “investors” from posts here and across social media after the parabola broke Dec. 18, that the direction on Bitcoin is 100% toward zero. The parabola nature of its rise guarantees it coupled with the lessons of history.
To all Bitcoin holders, listen to Anna, Clive Maund, Gary Savage, myself, and many others
and sell NOW.
Hi – many thanks for your comments which are much appreciated and to be honest I have been rather surprised at the vitriol which has been forthcoming following this and other posts about the severe correction currently underway with Bitcoin. As I say in all my posts the blockchain technology is here to say and will have many applications in the future. However, crypto investors seem to have much in common with gold bugs, who only ever consider their beloved asset should rise and cannot accept the fact it may fall, and fall hard. The same is true here, with investors having convinced themselves that Bitcoin and many others in this sector are set to continue their meteroic rise after this ‘minor’ blip! Over the next few months I expect to see the usual sad stories start to appear in the media, of investors who have lost everything from their pensions to their homes, having got in at or near the top on the fear of missing out. Let’s hope they do take heed, but given their fervour, I expect not!
They will not heed as history tells us. You will see those sad stories and probably a call of government intervention. Tragic and people NEVER learn. It’s a type of religion at this point so you’re attacking a false god that will propel the unknowing to their dreams of untold wealth. It’s the root of this anger. It’s been all about price and not what Bitcoin truly is and who knows if there is any future to cryptos and blockchain technology at all? Most can’t accurately describe the details of any of this. A true mania perfectly timed for this technology-driven age.
Hi Anna
Quite catastrophic your view on BTC. I respect it and honestly don’t care much as don’t have any money on BTC. Though I am a bit confused why a book about crypto investing / trading if you don’t really foresee a future for it? Or is it just Btc you expect a total collapse of? Regards
TS
Hi Tommaso and many thanks and this is a long term view, and in the short term of course there will be plenty of opportunities for both speculators and investors to make money using volume price analysis. Using this approach will provide both groups with clear signals of when to buy, when to sell and when to hold, which is what its all about – all best Anna
Your retarded analysis is beyond reason.
At 4k-5k miners stop mining bitcoin because it’ll be no longer be profitable, do you know this? have you researched it?
It’s also obvious miners will never sell their coins less then 4k-5k, which will create absolute heaviest resistance you can possible imagine. Simply, it is not possible to go beyond that.
Your stupid forex trade experience means nothing in crypto. There is a technology behind it, not only human behaviour. This is like saying internet will die.
Before publishing anything research first or go work with CNBC or FOXnews where you truly belong.
Idiots like you only spread FUD without research knowledge or any form of intelligence at all.
Hi Mats – many thanks for taking the time to comment, and as always we all have opinions – all best Anna
Anna let me get this straight. You anticipate BTC to dwindle down to single digit territory without taking into account mining pools, miner nodes, and mining wallet balances that will absolutely not release coins onto the market at any less than break even point (in this case $4,500 – $5,000). Furthermore, the total MC for cyrpto currencies is in the hundreds of billions with millions being invested into partnerships with blockchain companies by fortune 500 companies such as IBM, thus indicating a promising future for blockchain technology and the cyrptocurrency market place in general.
Your “analysis” about BTC is questionable in that you have no experience in cryptocurrencies whatsoever. Granted you may be qualified to speculate on other commodities, cryptocurrencies is an extremely irrational marketplace. Can you be honest with me and tell me if you have read the Bitcoin whitepaper written by Mr. Satoshi Nakamato? Do you even understand how blockchain technology works or why it exists? But what really surprises me the most about your update is that you intent to release A BOOK ABOUT CRYPTOCURRENCY? You spread FUD about it but intend to profit off a market of which you have no fundamental understanding of the underlying technology by selling a book? You are behind and you shouldn’t attempt to pretend like you are knowledgeable about it unless you research blockchain tech.
Hi Frank – many thanks for your comments which are much appreciated, and as I say in my forthcoming book I do believe the technology is here to stay and with many applications. My analysis of this market is the same as any other and based on volume, and indeed this market is one which describes Wyckoff’s first law perfectly. This is a market of supply and demand, ( other than the manipulation through the exchanges) and volume will then reveal when to buy, when to sell and when to hold, whether trading speculatievly or as an investor on a buy and hold. Whatever happens in the longer term, volume price analysis reveals the truth behind the buying and selling and in a market of pure supply and demand this is what will ultimately drive the price. If supply outweighs demand then prices will fall and if demand outweighs supply then prices will rise. Since early 2017 the volume of buyers in this market has been falling away as risks and uncertanties rise and until the issue of trust is addressed in all aspects, from security to transparency and regulation, then the buyers will become increasingly nervous. ONly when all these issues are addressed and trust is established will the market stabalise. Only my opinion of course but volume reveals the truth behind the numbers – thanks again and all best wishes Anna PS – I do seem to have created a minor storm:-)
It may fail but we now know how to do it
Foreword to the book by Saifedean Ammous
Let us follow the logic of things from the beginning. Or, rather, from the end: modern times. We are, as I am writing these lines, witnessing a complete riot against some class of experts, in domains that are too difficult for us to understand, such as macroeconomic reality, and in which not only the expert is not an expert, but he doesn’t know it. That previous Federal Reserve bosses, Greenspan and Bernanke, had little grasp of empirical reality is something we only discovered a bit too late: one can macroBS longer than microBS, which is why we need to be careful on who to endow with centralized macro decisions.
What makes it worse is that all central banks operated under the same model, making it a perfect monoculture.
In the complex domain, expertise doesn’t concentrate: under organic reality, things work in a distributed way, as Hayek has convincingly demonstrated. But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure.
It doesn’t mean all participants have a democratic sharing of decisions. One motivated participant can disproportionately move the needle (what I have studied as the asymmetry of the minority rule). But every participant has the option to be that player.
Somehow, under scale transformation, emerges a miraculous effect: rational markets do not require any individual trader to be rational. In fact they work well under zero-intelligence –a zero intelligence crowd, under the right design, works better than a Soviet-style management composed to maximally intelligent humans.
Which is why Bitcoin is an excellent idea. It fulfills the needs of the complex system, not because it is a cryptocurrency, but precisely because it has no owner, no authority that can decide on its fate. It is owned by the crowd, its users. And it has now a track record of several years, enough for it to be an animal in its own right.
For other cryptocurrencies to compete, they need to have such a Hayekian property.
Bitcoin is a currency without a government. But, one may ask, didn’t we have gold, silver and other metals, another class of currencies without a government? Not quite. When you trade gold, you trade “loco” Hong Kong and end up receiving a claim on a stock there, which you might need to move to New Jersey. Banks control the custodian game and governments control banks (or, rather, bankers and government officials are, to be polite, tight together). So Bitcoin has a huge advantage over gold in transactions: clearance does not require a specific custodian. No government can control what code you have in your head.
Finally, Bitcoin will go through hick-ups (hiccups). It may fail; but then it will be easily reinvented as we now know how it works. In its present state, it may not be convenient for transactions, not good enough to buy your decaffeinated expresso macchiato at your local virtue-signaling coffee chain. It may be too volatile to be a currency, for now. But it is the first organic currency.
But its mere existence is an insurance policy that will remind governments that the last object establishment could control, namely, the currency, is no longer their monopoly. This gives us, the crowd, an insurance policy against an Orwellian future.
Nassim Nicholas Taleb spent more than 20 years as a derivatives trader specializing in
hedging nonlinear risks and managing payoffs under complicated probability distributions.
Let us follow the logic of things from the beginning. Or, rather, from the end: modern times. We are, as I am writing these lines, witnessing a complete riot against some class of experts, in domains that are too difficult for us to understand, such as macroeconomic reality, and in which not only the expert is not an expert, but he doesn’t know it. That previous Federal Reserve bosses, Greenspan and Bernanke, had little grasp of empirical reality is something we only discovered a bit too late: one can macroBS longer than microBS, which is why we need to be careful on who to endow with centralized macro decisions.
What makes it worse is that all central banks operated under the same model, making it a perfect monoculture.
In the complex domain, expertise doesn’t concentrate: under organic reality, things work in a distributed way, as Hayek has convincingly demonstrated. But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure.
It doesn’t mean all participants have a democratic sharing of decisions. One motivated participant can disproportionately move the needle (what I have studied as the asymmetry of the minority rule). But every participant has the option to be that player.
Somehow, under scale transformation, emerges a miraculous effect: rational markets do not require any individual trader to be rational. In fact they work well under zero-intelligence –a zero intelligence crowd, under the right design, works better than a Soviet-style management composed to maximally intelligent humans.
Which is why Bitcoin is an excellent idea. It fulfills the needs of the complex system, not because it is a cryptocurrency, but precisely because it has no owner, no authority that can decide on its fate. It is owned by the crowd, its users. And it has now a track record of several years, enough for it to be an animal in its own right.
For other cryptocurrencies to compete, they need to have such a Hayekian property.
Bitcoin is a currency without a government. But, one may ask, didn’t we have gold, silver and other metals, another class of currencies without a government? Not quite. When you trade gold, you trade “loco” Hong Kong and end up receiving a claim on a stock there, which you might need to move to New Jersey. Banks control the custodian game and governments control banks (or, rather, bankers and government officials are, to be polite, tight together). So Bitcoin has a huge advantage over gold in transactions: clearance does not require a specific custodian. No government can control what code you have in your head.
Finally, Bitcoin will go through hick-ups (hiccups). It may fail; but then it will be easily reinvented as we now know how it works. In its present state, it may not be convenient for transactions, not good enough to buy your decaffeinated expresso macchiato at your local virtue-signaling coffee chain. It may be too volatile to be a currency, for now. But it is the first organic currency.
But its mere existence is an insurance policy that will remind governments that the last object establishment could control, namely, the currency, is no longer their monopoly. This gives us, the crowd, an insurance policy against an Orwellian future.
Hello Anna,
With all respects, could you please explain further about the price pause call? How did you come up with these values ( $4,482 and $2,779)? A chart analysis would be helpful, and why do you think that the price will come down to that level? Could you explain by using the data instead of just opinions please? Thanks, Thomas
Hi Thomas – these are the key levels which are currently on the slower timeframe charts and from a technical perspective of support and resistance likely to offer support as these levels are approached in the longer term. All best Anna
You are hopelessly uninformed and are just spreading FUD, perhaps to buy BTC and other cryptos for a lower price yourself? Let me drop some facts on you:
https://www.bloomberg.com/news/articles/2017-12-21/goldman-is-said-to-be-building-a-cryptocurrency-trading-desk
Goldman Sachs is planning on opening a cryptocurrency trading desk. Do you really think that Goldman would be starting this venture if they thought, like you do, that btc and other cryptos were going down the drain? Nope. Always follow what the smart money is doing. Goldman is probably buying up BTC and Ethereum with all its tentacles right now during this dip.
https://finteknews.com/canadian-pension-fund-omers-investing-ethereum/
Hmm, what’s this? Large Canadian pension fund OMERS investing in Ethereum, and buying a large stake in the ETH token. I’m sure they are just speculating though, and haven’t done any due diligence, like consult this blog! /s
Also if you’ve seen crypto charts for the last 3 years you’d know that during Chinese New Year and immediately before (like, the time we are in now) the crypto markets dip because the Asian markets cash out some crypto to pay for parties and stuff. Well, if a billion or more people do this, then you have what you think is a “crash”. But it’s not. Chinese New Year is a time when a lot of money changes from hands from the older generations to the younger generations, and it’s the younger generations that buy crypto. Once Chinese New Year is older I expect a lot of the “red envelopes” given out during the festive season will find their way onto crypto exchanges.
Stop spreading FUD!
Hi – and many thanks for writing and also for your thoughtful comments which are appreciated and certainly more considered than some I have received, so thanks for being polite. One of the things I make very clear in my book is that blockchain technology is here to stay and will ultimately be even more life changing than the internet itself. This is a given. The technology is too powerful and with many applications in many different fields. With regard to Goldman and their trading desk, I would be amazed if this were not in their plans. After all as one of the largest market makers there is too much money for them not to be involved, and whether the price is low or high for any cryptocurrency, there will be both traders and longer term investors buying and selling. I have not suggested this market will not survive, some will and others will not, but what is lacking at present is trust. My analysis of this market is the same as any other and based on volume, and indeed this market is one which describes Wyckoff’s first law perfectly. This is a market of supply and demand, ( other than the manipulation through the exchanges) and volume will then reveal when to buy, when to sell and when to hold, whether trading speculatievly or as an investor on a buy and hold. Whatever happens in the longer term, volume price analysis reveals the truth behind the buying and selling and in a market of pure supply and demand this is what will ultimately drive the price. If supply outweighs demand then prices will fall and if demand outweighs supply then prices will rise. Since early 2017 the volume of buyers in this market has been falling away as risks and uncertanties rise and until the issue of trust is addressed in all aspects, from security to transparency and regulation, then the buyers will become increasingly nervous. ONly when all these issues are addressed and trust is established will the market stabalise. Only my opinion of course but volume reveals the truth behind the numbers – thanks again and all best wishes Anna PS – I do seem to have created a minor storm and I am flattered that some consider my views sufficient to move this market, but rest assured they don’t. This will be dictated by the volume of buyers and sellers and the balance of supply and demand – nothing else 🙂
Hey Anna, I loved your book on VPA and I have been using it to try to trade in the crypto markets. I’m sorry for all the negative comments, these people are obviously suffering from current market conditions.
I’m sure most of the people leaving comments are heavily invested in crypto, which is why they are very upset when they read anything that goes against the idea of them making millions and bitcoin going to 30k USD. The truth is that since the last fall from 8k, I have put 1/3 of my crypto holdings in USDT (I know that tether itself is a risky instrument considered controversial) and I am waiting for the price to drop even further. Until I start seeing some strong signals that indicate a reversal in the market, I may continue to withdraw more funds.
On a side note, do you think the bad news and FUD could also be ‘Market Insiders’ and big hedge funds creating a plan of attack to manipulate and drive prices down, so they can get in the market at cheap accumulation prices, before they push the marketing button again and push prices into the distribution phases? Or you think this is a mere correction from the craziness that happened in the past 4 months?
Thank you for everything.
Stephen
Hi Stephen and many thanks for your very kind comments which are much appreciated and it’s nice to receive some feedback which isn’t littered with expletives or vitriol! As you can imagine and no doubt seen, the response has been interesting to say the least, and whilst I have published most, even the negative ones, any with bad launguage have been removed:-) I have to say I was flattered by the response of many of these people who seem to think I can move the market single handedly, which is funny to say the least, but that seems to be the general view! However, as you say the response is probably driven by the heavy investments in Bitcoin and others which I can understand. Indeed we saw the same hysteria with gold when approaching the $2000 per ounce level and reported in all the mainstream media with investors jumping in expecting the market to continue higher forever and driven by the fear of missing out. Much the same here sadly and no doubt the sad stories of pensions lost and life savings gone will emerge in the near future as prices continue to fall once more. I believe the blockchain technology is here to stay, and it is simply a question of when and where the buyers will return.
My analysis of this market is the same as any other and based on volume, and indeed this market is one which describes Wyckoff’s first law perfectly, and could almost be considered ‘pure’ in this sense. This is a market of supply and demand, ( other than the manipulation through the exchanges) and volume will then reveal when to buy, when to sell and when to hold, whether trading speculatievly or as an investor on a buy and hold. Whatever happens in the longer term, volume price analysis reveals the truth behind the buying and selling and in a market of pure supply and demand this is what will ultimately drive the price. If supply outweighs demand then prices will fall and if demand outweighs supply then prices will rise. Since early 2017 the volume of buyers in this market has been falling away as risks and uncertanties rise and until the issue of trust is addressed in all aspects, from security to transparency and regulation, then the buyers will become increasingly nervous. ONLY when all these issues are addressed and trust is established will the market stabalise. Just my opinion of course but volume reveals the truth behind the numbers and this is what my book on Cryptocurrencies is all about, the application of volume price analysis to this market, which I hope will give both investors and traders the knowledge they so badly need to decide when to get in, when to stay in and when to get out! The book is in final editing and will be on Amazon this month in both Kindle and Paperback versions and is called Trading and Investing in Cryptocurrencies using volume price anlysis. Like my other recent books this will include a large number of worked examples from all the major cryptos and in all timeframes, from fast to slow ( 80 approx examples ) all annotated and explained in detail. I hope it wil help traders and investors make more informed decisions.
With regard to your point on Tether, yes certainly a risk here, and one which is under the SEC spotlight at present, so caution required:-) Finally, you raise an interesting point on the manipulation of price. There is certainly an element of this already in play via the exchnages which are largely hidden from view, and as always with so much money at stake it is no surprise to see. Also interesting to note Goldman Sachs are opening a trading desk in the near future and as I have suggested whatever the price ultiamately, whether high or low, there is money to be made! The market will stabilize and settle down but I believe this will only happen when trust is established in every aspect. We are a long way off this point at present, and with gloabl authorities continuing to crack down, and security remaining an issue (let alone transparency) this remains the top driver. At present it is all about emotion and hype – stability will arrive in the longer term, and like any other market then becomes one of informed trading decisions – hopefully using volume – thanks again and wishing you every success – Anna
Finally
One topic that I hope you cover in your book is the amount of pure market manipulation that happens in the crypto market. In the smaller Cap coins, there will be big players with millions of dollars, who will scoop into a low volume coin and slowly accumulate the coins for a few weeks. They will then single-handedly manipulate the prices to do massive 400% gains, as they are dumping off their shares to unsuspected beginners. They also create buy and sell walls, that prevent markets from moving up or down because they have such large volumes. Because there is no regulation in cryptocurrency, the amount of market manipulation that happens is insane.
There are also big influencers and pump groups that come along and pump and dump coins left and right. You can see coins like TRX and RIPPLE that have been massively pumped and dumped in recent months. I would love to hear your thoughts on this.
I can’t wait to read the new book.
Hi Stephen – many thanks and this should be published in the next week or so, and I do cover the ‘smaller’ cryptos too – I hope you enjoy reading it – best wishes Anna
Hi Anna,
I am a huge fan of your book on VPA and thank you so much for sharing such valuable information. But I think your bitcoin prediction couldn’t be more wrong. Here is my argument:
First of all, on the fundamental level, I believe in the tech and think it will have a huge impact on our world.
On the price level, although I am quite new to trading, I would like to point out that, the day before, the candle closed as a hammer with ultra high volume, followed by a long legged doji with high volume. As you mentioned in the VPA book, aren’t these some major signs of reversal?
Cheers,
Davo
I’m looking at the bitfinex chart btw
Hi Davo – and first of all many thanks for your kind and generours comments which are much appreciated, and as you can see from the various comments associated with this post I do seem to have created a minor storm! But then we all have opinions and that’s what makes the market. And moving to your point on the hammer candle and good volume, this is indeed a sign of buying and something we have seen several times in the move lower since December. Each time we have seen good volume signalling the buyers moving back in, but on each occassion the rally has been weak on average or low volume, and this is the key. As I’m sure you appreciate no market ever moves lower or higher in a straight line with the trend punctuated with pauses as buyers or seller move in after a strong move lower or higher. So this is a facet of price action we will always see in all markets. I agree entirely about the technology, and as I have said to others, and indeed something I explain in my forthcoming book, the blockchain technology is here to stay and will possibly have a greater impact on our lives than perhaps even the internet. So I entirely agree with you.
My analysis of this market is the same as any other and based on volume, and indeed this market is one which describes Wyckoff’s first law perfectly, and could almost be considered ‘pure’ in this sense. This is a market of supply and demand, ( other than the manipulation through the exchanges) and volume will then reveal when to buy, when to sell and when to hold, whether trading speculatievly or as an investor on a buy and hold. Whatever happens in the longer term, volume price analysis reveals the truth behind the buying and selling and in a market of pure supply and demand this is what will ultimately drive the price. If supply outweighs demand then prices will fall and if demand outweighs supply then prices will rise. Since early 2017 the volume of buyers in this market has been falling away as risks and uncertanties rise and until the issue of trust is addressed in all aspects, from security to transparency and regulation, then the buyers will become increasingly nervous. ONLY when all these issues are addressed and trust is established will the market stabalise. At that point we will then see a classic buying climax develop as buyers return and buy with confidence. Just my opinion of course but volume reveals the truth behind the numbers and this is what my book on Cryptocurrencies is all about, the application of volume price analysis to this market, which I hope will give both investors and traders the knowledge they so badly need to decide when to get in, when to stay in and when to get out! The book is in final editing and will be on Amazon this month in both Kindle and Paperback versions and is called Trading and Investing in Cryptocurrencies using volume price anlysis. Like my other recent books this will include a large number of worked examples from all the major cryptos and in all timeframes, from fast to slow ( 80 approx examples ) all annotated and explained in detail. I hope it wil help traders and investors make more informed decisions. – thanks again and wishing you every success – regard Anna
Thank you so much for replying me Anna!
I can’t wait for your new book, I really appreciate what you are doing and please keep up the good work!
Wish you all the best
Cheers,
Hi Davo and good to hear from you and you’re very welcome – the new book Trading & Investing Cryptocurrencies using Volume Price Analysis will be avaialble on Amazon in the next couple of days, so I hope you enjoy reading it. All best wishes – Anna
Hello,
I am skeptical that I will get a response a year after this post, but still have to at least try. I just started reading your book ” A complete guide on volume price analysis ” and was quite impressed and decided to jump to “Investing & Trading in Cryptocurrencies Using Volume Price Analysis” since cryptocurrency is what I am nterested in. Now after googling for your book I found this page and this analysis and all well and fine, but then I read prediction to go to single digits, now this made me very confused, ofcourse I am only learning about trading and TA, so excuse my potential ignorance, but how have you come up with those numbers? the single digits I mean, I can see path down to 1000$ as you described and it seems we are very well on this road and now around 4k we have a pause like you predicted and I can follow the support zones to 1000$ and it all makes sense. But then when we get to single digits predictons, this is where I am totaly lost, I know that anything can happen even going to single digts or even zero, but could you maybe please elaborate a bit more how you came up with those single/double digit targets? Or maybe more direct question of what puzzles me is what indications are showing that we are going past previous bear market low of about 160$.
Thank you
Hi
Many thanks for your kind comments which are much appreciated, and no doubt you are surprised I have replied, but this is something I always try to do wherever possible, even to those who express strong opinions or have different views. So first of all thank you for investing in my books, and I hope you are discovering the power of volume price analysis for yourself. And so to your question which is an interesting one. At the time this post was written Bitcoin was trading around $10,000 with meteoric selling climax having taking the crypto dramatically to almost $20,000 before reversing equally sharply. Since the time of the post it has fallen substantially and today is trading at $3,939. We have to remind ourselves of three things here. First, it is only 6 years since Bitcoin was trading at $13.62 – January 2013 to be precise. Second, the all time chart has the classic structural shape of many shares we saw at the height of the dot com boom – meteoric rise, followed by equally dramatic collapse. Third, all cryptocurrencies are subject to the many and varied forces from regulation to security, uptake for applications, and acceptance as a trading instrument. In addition and having lost over 80% of its value, this is generally considered the point of no return for any form of asset, of which Bitcoin is just another. So in summary, the asset has all the characterisitcs of a bubble which is now bursting and as such has the potential to move lower and back to the levels of 2013 and 2014. When I wrote this article I received many abusive emails and comments some of which I had to remove from the site. Personally I have no bias one way or the other – I just call it as I see it. The problem for speculative traders now is that much of the volatility has disappeared and continues to do so, with intraday trading in narrow ranges, so that even the interest from traders themselves is waning and reflecting the lack of investor volumes which are reflected on the chart over the longer term timeframes. The volume profile on the weekly chart is classic with the extreme volumes on the climax and volume on any move higher failing to sustain a longer term recovery. From a technical perspective the next key levels are towards the $3000 region and therafter around $1200 and below. Throughout this period there will be opportunities for trades both long and short which is what VPA is all about – idnetifying these intraday and longer term opportunities based on volume price analysis. Hope this helps and thanks again Anna