The FTX deal ushered the cryptocurrency market into the final bear market stage, which began in the spring of 2021, when interest rates began to rise and the US dollar hit a long-term low. The price of Bitcoin (BTC) is now developing its latest downward wave, the 5th, which constitutes (in my humble opinion) a long-term opportunity.
The FTX affair and systemic risk
Sudden return to earth for the price of Bitcoin (BTC) which had been holding on to the support of $ 19,000 for over 6 months and which was beginning to benefit from a more favorable cross-asset environment (interest rates and US dollar on Forex no longer increase ).
But the cryptocurrency market has had to look for a reason to collapse on its own, the risk of failure of a major cryptocurrency exchange on a global scale.
Our team has published and continues to publish many informative articles about Bitcoin price, cryptocurrency news, I invite you to follow the FTX deal, the fall of the 2nd world exchange.
My specialty is graphics. But it must be borne in mind that the FTX affair, if it does not quickly lead to a rescue solution, it would therefore represent a systemic risk for the ecosystemthus sweeping away any relevance from a technical point of view.
In my previous two analyzes, I had highlighted that BTC volatility has reached an all-time low, an event that it could create a flight explosion. Here we are and the market has decided on the bearish trajectory.
At the fractal level, especially the Elliott wave approach, I believe the price of bitcoin is now building wave 5 of the bear marketthis is the last stage of the decline, the one that represents a long-term technical opportunity (barring systemic risk).
The chart below shows BTC’s weekly Japanese candlesticks, with a logarithmic scale and 5-count count. The “theoretical” goal for this wave 5 is between $ 9,800 and $ 13,800.
This is the price range that must be defended, otherwise the long-term uptrend will be questioned..
Chart showing the weekly price of bitcoin Japanese candlesticks in logarithmic terms
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Two graphs pointing to the long-term area of interest of this latest purge
I have selected two graphs that each represent the deviation from the average of the Bitcoin price in their own way.
The common message is: in a market environment that eliminates systemic fundamental risk, then the price of bitcoin is very close to a very long-term buying zone.
It is therefore imperative to find a financially sound solution for FTX, because otherwise the market would sink into a technical no-man’s-land, which would mark the end of the upward momentum that began more than 13 years ago.
This first chart shows that a support line is in sight on Bitcoin’s lower percentage curve from its previous all-time high.
Chart showing the drawdown curve in% of BTC from its old historical return (ex-ATH)
This second chart should get you thinking about the Stock To Flow model, but it’s slightly different.
This is primarily a standard deviation chart showing that if the market does not hit a major low in the $ 10,000 / $ 14,000 price zone, it will therefore enter a still unknown technical phase in its young history.
Chart displaying the Bitcoin Power Low Corridor indicator from Capriole Investments Limited
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