There’s been a lot of yammering from ‘financial analysts’ about the recent market rally, attributing it to Zynga’s adoption of Bitcoin. Whenever I read these articles, it makes me cringe almost as much as when I have to hear them try to moronically explain the Bitcoin protocol. Don’t get me wrong, I’m not dogging on everyone who doesn’t understand the intricacies of something so esoteric, but it is painful to watch professional analysts fail so hard.
Was it Zynga?
Nope, and it makes me wonder if these idiots have ever looked at a graph in their lives. These journalists are masters of hindsight bias; prior to the adoption, they’re absolutely silent– no speculation whatsoever as to the effects of any catalysts on the markets, then afterword everybody hops on the bandwagon. Bloomberg, Forbes, Business Insider, literally everyone is singing the same tune, and its frustrating.
Its all part of the plan.
Most analysts who have some idea how to read a graph and have been monitoring cryptocurrencies for awhile saw this coming from a mile away. I started writing the January speculation article in late December and even then I expected a return to supports at ~850. So in an attempt to help readers understand how experienced analysts all reached the same conclusions without Zynga, I’ll walk you through how I knew this rally was coming.
Historically, 600-750 has been the most important reversal zone since its initial rise to over 1000 USD, and I don’t expect that to change anytime soon. Just plotting horizontal lines for historical reversal, it’s easy to see an extreme confluence in this area. Although inexperienced traders still have the crypopocalypse in the back of their minds, and treat this as their favorite selling zone, more experienced traders lick their lips at this entry.
Plotting lines for moving supports and a recurring resistance at ~1000 (also recognized as a significant psyche wall), the narrowing prince channel becomes more clear. Moving up the channel you can see a small area I’ve labeled ‘Crash Zone,’ which has been determined via channel congruence, Fibonacci retracement, and neural net analysis. All roads lead to this point– keep in mind its not an exact science so date and price are not exact, but plus or minus about 5% we can expect to reach this very important point soon. If you’ve read my January Speculation article you’ll recall I talked about the importance of payment processors this month, especially mid-month. This is in relation to the point labeled ‘Crash Zone’, without a major catalyst with near certainty I can say Bitcoin will experience a major crash again, with lows just above the point labeled ‘Minor Reversal Zone’, with a catalyst I would expect markets will bulldoze over the psyche wall at ~1000 and Bitcoin will reach unprecedented highs.
The take home lesson.
Get your market analysis from sources that know cryptocurrency, not these clowns who like to Monday morning quarterback the markets whenever they swing 10%.