If you have been following this blog for a while, you'll know it's very rare that I make any future market predictions. That said, I would like to share with you an interesting (anomaly) in the end-of-year Bitcoin price we have seen over the last 13-year history of Bitcoin's price action.
Where Bitcoin Goes, the Market Follows
The Bitcoin price is significant because where Bitcoin goes, the rest of the market follows. If the price of Bitcoin increases, so does the rest of the market. If the price of Bitcoin falls, so does the rest of the market. As long as Bitcoin retains its market dominance, the market to a large extent will follow the price of Bitcoin.
By now it's clear that 2022 so far has been a bear market for the cryptocurrency space. The question on many investors minds is - What does the rest of the year hold?
While making predictions can be dangerous, it's necessary as an investor to have a sense of where the market is going. Your approach to investing (whether in crypto or stocks) needs to adjust to the market conditions.
This site's focus has always been on low-market capitalized cryptocurrencies (also known as low-cap gems). This is where the greatest returns can be made. However, this approach isn't well suited for bear markets. During a bear market, it's best to invest in undervalued blue chip cryptos which will weather the bear market and when market conditions turn, refocus on investing in low-cap gems.
In my opinion, we are still in the run-down phase of this bear market and will likely continue to be until the new year. During the run-down phase, it's best to either build your cash reserves (wait on the sidelines) or dollar cost average into solid blue chip cryptos.
It's during the run-up phase where the greatest wealth ever has been made in crypto. This is where it's the best time to buy into low-cap gems and where the greatest wealth appreciation is made.
If you would like a refresher on the market phases, please read this article:
Bitcoin Price: An Interesting End-of-Year Anomaly
There is an interesting anomaly we have seen in the price of Bitcoin over the last 13 years.
In a Bull market, the price of Bitcoin peaks at the end of the calender year.
However, what happens during a bear market?
Interestingly, we see the same exact price action play out, just in reverse.
In a Bear market, the price of Bitcoin hits its low at the end of the calender year.
In 2014, the Price of Bitcoin hit its all-time low on January 13th
In 2018, the Price of Bitcoin hit its all-time low on December 15th
In 2022, we see a similar pattern occurring…
If this trend holds true, and as we are currently in a bear market, it’s likely we will see Bitcoin hit its all-time low (for the year) price at the end of the year. This will be a price below $20,000 and could range anywhere between $10k-20k.
If you would like to read the full article regarding the Bitcoin Price Predition for 2022 (as this is only an extract), you can find it here:
The Shemitah Cycle
While on the topic of market prediction models, one cycle which goes back to Biblical times is The Shemitah Cycle. It's a seven-year cycle which has been tracked since bibilical times and been linked to the great depression, global recessions, 911 terror attacks and more.
For those of you interested in the more esoteric prediction models, you may find it interesting in learning that we are currently in a Shemitah year and it ends on September 25, 2022.
To learn more about the Shemitah cycle and it's impact on global markets, check out this article:
Monthly Altcoin Pick:
We will continue with our monthly altcoin picks, focusing on projects with long-term potential with our next Altcoin pick being released in September. In the meantime, while it's projected that Bitcoin will likely continue to decrease in price (and the rest of the crypto market) in the upcoming months, if you are able to pick up Bitcoin at under the $20k price point, it's a very good purchase at this price.
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Until the next report,