A Detailed Analysis of the BTC Market for the Next Four Years from the Professional Trader Bob Loucas
In this article, we will only tell the opinion of one of the experts in the cryptocurrency industry, trader Bob Loucas.
This article is not a guide to action and moreover, not financial advice. Investing in cryptocurrency is a risk, so make a decision with a cool head and think carefully about everything. Further goes Bob’s direct speech.
Bob Loucas Prediction
I have been studying the cryptocurrency market for a long time and noticed that it is cyclical and my theory is based on that. For all the time of its existence, Bitcoin went through two 4-year cycles, and now we are at the very beginning of the third. And I want to tell about it in more detail.
So let's get started
According to this theory, the December bottoms mean the end of the previous 4-year cycle, which spent 52 weeks in the fall and 153 in growth. This period involves 205 weeks, which is only 3 weeks less than 4 years. With high probability, the BTC course on December 10, 2018, is the absolute bottom of the past 4-year cycle. It is worth noting that this happened almost perfectly in time, just at the 205th week after it began. At the beginning of the year, there was still a possibility that the price of BTC would fall even lower than it was in December 2018 to complete the 4-year cycle, but this did not happen. Instead, we can observe an incredible power at the beginning of a new 4-year cycle and movement above the peaks of the previous 60-day cycle. Therefore, for me, the upward movement in early April is confirmation that the “bottom” in December really marked the end of the previous 4-year cycle. Both price movement and time periods indicate that the new cycle has already begun.
In January 2019, I advised not to wait for new bottoms, since the rate already dropped sufficiently during this bear market, to be more exact, by 85% since the previous peak. As soon as the bottom was passed, investors and traders got a chance to start accumulating positions, that is, to start buying BTC little by little. It is important to do it with a cool head, and for the funds that you are prepared to lose, otherwise, you will not be able to act rationally. If you did not manage to buy a coin before the market grew significantly in early April 2019, then do not worry, because now we are at the very beginning of a new 4-year cycle and it is not too late to invest. As of the time of this writing, Bitcoin rose by $1,500– $2,000 from December bottoms. In the long run, this will be something like mathematical rounding, as the next bull market should lead us to a price of 200-300 thousand US dollars for one BTC. But it is important to understand that this will not happen tomorrow or next week. Probably, after such a powerful upward movement, there will be a period of stabilization, which means that the sideways move will continue.
We observed something similar at a time when the extreme 4-year cycle came to an end. Let's go back 4 years ago for a while. If you look at the chart, it is possible to notice quite similar time periods. Last time the bear market lasted 58 weeks. Then we saw a sizeable price dump in January, it is very similar to what it was in December 2018. Good growth followed after that, and then there was a retest of the level of support. Next, we see an even higher great race. If to look at the chart, we can see that at the moment there is a very similar situation. Therefore with high probability, we are waiting for the next large price drop down in the near future, as it was four years ago. This downward movement frightened the big number of people. Perhaps today the volatility from $317 to $198 does not look terrible, but in the summer of 2015, it was a 40% drop. No doubt, this dump forced many weak traders to leave the market, after which a truly long and protracted bull market began. Now, going back to the current time period, we see something similar: a lot of people are buying more BTC right now, in the hope to see phenomenal growth in the near future. But with a high probability, a significant price rollback will occur in the short term (at the end of the 60-day cycle), which will be a punishment for many people. The matter is that if you are a long-term investor who is gaining positions, then do not overdo it at this stage. The potential reward that figures in front of all patient investors is so great that you should not risk too much capital for immediate profit. If you succumb to the temptation and put all means, not at the right moment, then it can simply knock you out of positions. If to look at the bottom of the previous 4-year cycle (December 2018), it seems to be shocking, but for me personally, it was expected, I was shorting all this time. But almost five months have passed, and there have been no such drains on the market since then. Bitcoin, like any digital asset, such as gold, likes to cause maximum pain on inexperienced investors and traders. I believe that we will not be able to break through the resistance level of $6,000 without a prior large-scale dump. I do not claim that this drain will be in one or two weeks, it is possible that it will not be until August 2019. This event will be absolutely natural since this happens all the time in all markets. Large asset drains often occur just before they begin to conquer new peaks. That is why such a rapid downward movement is necessary for Bitcoin in order to break through the resistance level of $6,000. As a rule, after such rapid falls, there is always an almost instantaneous price jump upwards. If the resistance level is broken, then probably a more steady bull trend will begin since at this stage a capital accumulation step, as well as getting rid of weak market players will already be passed. But I want to warn you that I can change my point of view in short-term trading, especially on daily charts. Therefore, I will not give forecasts for tomorrow or for the week ahead, because it is almost impossible to predict the behavior of such an irrational market in such a short period of time. Remember, if you are absolutely confident, the market will destroy you. That is why I am not 100%, but about 98% sure that the December minimum is the real bottom of the past 4-year cycle. And now we are at the beginning of a new cycle, which will spend about 150 weeks in a bullish trend (if to rely on historical analysis). In past cycles, growth periods lasted 153 and 142 weeks, respectively. And again, this is only an approximate period of time and not specific financial advice. It is not very difficult to calculate that this period (150 weeks) will end around October 2021. If you are a long-term investor, then the short-term market fluctuations absolutely should not bother you.
When will the bull up rally of the next 4-year cycle begin?
It will be very difficult to pass the resistance level, which is in the trading range 5800 - 6100 US dollars. Frankly speaking, I'm not even sure that we will be able to overcome it in 2019. The fact is that building a strong foundation takes a lot of time in any new cycle. But I am sure that at some point, the price will be able to pass it, after which this trading range will turn into a level of support. After that, the rate will look for a new level of resistance, which means that it will go even higher. You probably noticed that the biggest increase in the previous cycles was recorded at the very end of the bull trend. It is worth noting that this happened very quickly and rapidly and not all people managed to get profit from this.
Let's analyze this chart - this is the explosion point in January 2013, and the new record peak came in November 2013. That is, it took 11 months for the asset to reach a new maximum - to grow from $13 to $1100. Then a grand rollback followed and the BTC price reached that level again only in April 2017. Over the next six months, Bitcoin grew 20 times, after which a hard correction followed again. This suggests that most profits happen only when retail investors enter the market. But before that, it is going through several stages:
- institutional investors coming.
The vast majority of people buy just at the time when the price rises exponentially. It is important to understand that now we are only at an early stage of accumulation, which is why we should not pay attention to the fact that the rate has increased by $1,000 in a couple of days. As it was mentioned above, we are likely to be able to pass the resistance level of $6,000 only at the end of this year. And only at the beginning of 2020, a more steady growth will begin, in my opinion, at that moment the price of BTC will vary from 7,000 to 8,000 US dollars. This will be the stage at which institutional investors will come. Well, parabolic growth will begin only after the price reaches the previous historical maximum ($20,000). After that, the price can reach $200,000 - $300,000 in just a few months and then another rollback will follow.
We have already passed all of this, each cycle works on nearly the same scenario. If my theory is correct, then everything will happen in the following order:
- 2019 - BTC will try to overcome a strong resistance line of $6000 (capital accumulation stage);
- 2020 - the beginning of stable growth, from about $7,000 to the previous historical maximum of $20,000 (the stage of notification and the entry of institutional investors);
- 2021 - parabolic growth to the level of $200,000 - $300,000 (entry of retail investors into the market);
- The end of the 2021 - 2022 - a long bear market.
But remember, this is just my theory, which is based on historical analysis and my personal experience. That is, there is a possibility that things may not go according to this scenario. No one knows the future 100%, so before you invest your own money anywhere, think carefully, because potentially you can lose it.