The crypto markets teasing us with anticipation. Which way will they break? Let's take a look...
In general, low volatility in the markets, especially the crypto market never lasts too long. This is the recharging of batteries if you will.
In the crypto world, these periods have usually been followed by dramatic price action.
What is uncertain at this point is the direction of the break.
If we look at traditional finance, especially the news cycle, I see some interesting trends. I could break them into 3 big indicators that suggest a potential upside breakout:
- the traditional financial markets are showing more and more signs of a breakdown. Pundits and banks and all sorts of financial fauna are starting to show a cautious side, and sometimes downright pessimistic outlook on traditional markets. It will not take long for a critical mass of people to become aware of this. How long before this becomes a stampede?
- the traditional financial players - the big fish - are looking more and more toward ways to get involved in bitcoin and the other majors in the crypto space. There are more and more of them that do not want to be the ones left holding the old bag when the new one takes off. How long before this becomes a stampede?
- housing bubbles are bursting all over the world. Australia, Canada, US, UK, NZ.... . More and more news stories are covering the decline in housing markets everywhere. Statistics like sale clearance rates, prices, etc.. are all reversing. For some markets like Australia, just a reversion to the mean would be a massive drop in prices sending a fat slab of mortgage holders underwater. This is gaining speed and there is sooooo muuuuuch debt tied up in these markets.How long before this becomes a stampede?
Stories are starting to crowd the news cycles that follow a more somber tone, and are sometimes downright negative. These points above are usually not far from their subject matter.
No financial news person worth their salt wants to be on the wrong side of the trend reversal too long. They will lose all their credibility and this is what keeps food on their tables.
Most importantly, the big hitters in the halls of finance are becoming contrarian suddenly. Janet Yellen openly talked of what to do when the next crash happens.
Wait! What?
While she was at the wheel, there was no talk at all of any chance of any sort of crash. And what now? talk of doom and gloom? She came out recently with a statement suggesting that in the next downturn the fed should consider the idea of buying equities to support the economy! Is this her starting to be concerned for her legacy?
I guess this is should be expected. Since this is the last step available to central banks to keep a debt based financial system standing: go waaay deeper into debt and totally abandoning free market economics.
If her suggestion is taken seriously (And it has already been done in Japan for quite some time) This will mean that the central authorities will decide what companies live and die. Nothing to do with how they perform or if they serve a useful purpose or not.
Janel Yellen was the same person who was quoted as saying:
"I 'don't believe' we'll see another financial crisis in our lifetime"
Why do mention these things?
This flip flop is just another sign that the people in control are realising they are not in as much "control" as they thought they were. And so to preserve their reputations (and speaking fees when retired), they must now hedge their comments.
Historically this happens on the hush hush just before some major negative event.
The insiders are already quietly preparing. The whales are ever so gently exiting the pond of liquidity trying to avoid disturbing the tranquil surface the least. And the central banks of the world are flooding the pond with fake liquidity to help them. BTW, that fake liquidity is fuel for a fire of inflation that will burn hotter than the sun when it gets going.
Money always looks for a safe haven with promising returns. Now there is more of it than ever before.
Crypto does not have to be perfect, it only has to be better than the rest, and I leave it to you to decide on the quality of the contenders.
Profile people in the crypto world get cornered into bold and baity statements in bitcoins price going forward.
Silly banality, but none the less amusing.
If bitcoin goes to 1 mill, I would imagine that a lot of things will be costing A LOT more than we are used to.
Charts?
Huh, no Charts today?
No - because I will not feed you bullshit and say I see something when I do not.
TA over the last days has been useless.
What I suspect - and rather strongly - is that volatility is coming.
When?
Hard to say but a lot of TA indicators seem to point to soon
My feeling is we are going to see it this month.
Which way?
Too close to call. Too much emotion the future is.
How to trade it?
Hmm, all depends on the size of your balls!
If you go in, then be ready for a wild ride.
I want to leave you with a quote I liked. It is not recent.
It is from an unnamed crypto pundit with a little more balance than most. He stated something to this effect:
"If you hold 4 btc, one day that will be enough to buy yourself a decent house"
Today 4 btc is about US$26,000.
"Decent" is a relative term for a home, but one could safely say that we have already reached the "one day" from this quote.
As always guys, leave comments, have fun and trade safe.