Bitcoin Boogaloo Followup

Since my latest commentary on Bitcoin™ things appear to be taking a turn that’s making quite a few suddenly appear nervous when engaging me on the subject. i.e., the same excitement that the “to the moon!” announcers had today regarding the SpaceX™ launch, only to find out minutes later it was falling back to Earth, not in a controlled landing, but rather – in a fireball. I’m not saying that Bitcoin is currently, itself, back into a fiery free-fall mode. But there were some I talked with today where you could feel the apprehension in their voice.

So with that, I thought I’d just follow up with a few charts that may just explain why they may have good reason to be nervous. They are nearly self explanatory.

The first is Bitcoin via one hour increments. It is this perspective that was the original impetus for them feeling “Bitcoin is back, baby!” But has since appeared like it hit a “brick wall” at around $31K and has since been falling a bit too quickly for many’s liking. To wit:

(Charting Source)

Here’s another view that shows why that “brick wall” analogy may be far more relevant than most think at first glance. Again, to wit:

(Charting Source)

The above “picture,” as I like to call it, shows just why that nervous feeling may be relevant.

Note: For those that may not fully understand the technical analysis implications of the coined term “overhead supply,” think of it this way…
Everyone that purchased Bitcoin at prices within that square box have been stuck, some for nearly two years, in losing money positions, probably pleading to the sky for as long something like “If I can just get back to even, I’m selling and never going to touch this thing again. EVER!” That’s why what has taken place precisely where that arrow is has far implications than most ever contemplate. i.e., the human behavioral component.

But as they like to say in advertising, “But wait, there’s more!”

This isn’t just something the crypto aficionado crowd need to be concerned with. Rather, the entire “markets” may be about to experience the same. Here’s why…

The first is the S&P 500™ expressed via the E-mini™ futures contracts, again, via one hour increments. It just did something it has not done in well over a month. The red arrow expresses this detail. To wit:

(Charting Source)

And here it is pulled out via daily increments, again, to wit:

(Charting Source)

Let’s just say…

Things could suddenly go from exuberance to very, very, very (did I say “very?”) nauseating quicker than a heavy rocket ride can go from launch pad hysteria to crashing back to earth in a ball of fiery disappointment as was witnessed today.

As always, we shall see.

© 2023 Mark St.Cyr

Note: This is not trading or investing advice of any sort. This commentary is for “big picture” discussion purposes only. Please read, or re-read the “About This Site” page for any questions or clarifications.