Bitcoin holders have experienced some gnarly price action recently. From an all-time high of just above 65k to a recent low of 30k. Panic selling has begun and the rhetoric in the market is painfully negative, but mark my words, this sentiment is misplaced.
Hodlers have been here before
If you’ve been holding Bitcoin for a long time, then you will probably be unfazed by the latest drop. You’re a veteran of this war and will not be separated from your crypto because the markets upset by a few tweets from the Martian king. You know the deal.
If you’re new to the space, then you may be riddled with fear. Perhaps you’re amongst the people who have already sold their holdings at a loss. If you haven’t sold (well done, you passed your first test) then you may be looking for some reassurance that your investment is still wise. There’s no better place to find this solace than in the data and charts.
The data
If you don’t already follow PlanB on Twitter then rectify this now, you will find a continuous wealth of knowledge here with some premium on-chain data.
So what’s going on in this chart?
The coloured dots cover the price action since 2013. Each colour indicates a different time to the next halving. The dark blue coloured dots are the closest to the time of the halving and the red dots are the furthest away.
This chart shows that the most optimum time to sell your Bitcoin is when the dots are a light orange/yellow colour. Currently, they are dark orange, meaning that we are still not in the selling phase of this cycle.
If we compare this cycle’s data to 2013, then we could assume that we are only halfway through the bull market, with new all-time highs just around the corner. It also reassures us how normal this price action is generally.
A parabolic rise followed the dip in 2013. This could be what’s happening now.
Another pearl of wisdom from PlanB, this chart is looking at the relative strength index (RSI). The last two cycles both had a drop around this time. This is super healthy, now the RSI has reset it can allow for further gains. Without a drop like this, it would be difficult for the price to continue rising.
A second Twitter account to add to your following list is the Halving Tracker, the account does what it says on the tin. It tracks the price action relative to the halving. Every day they post a new chart with the latest data included.
Personally I check this chart daily. It provides some much needed perspective, especially at times like this.
The halving tracker has the last two cycles, the current cycle and an average.
You will notice that the first cycle had a double peak, an initial ATH followed by a dump and then resumption to higher highs. The current price correction could be an indicator of a similar cycle to 2012. If that’s the case then it’s only a good thing, because the price increased by over 2000% from the dip.
What’s the takeaway from all of these charts? The bull run is far from over. HODL.
DISCLAIMER
I am not a financial advisor. This is not financial advice. This article is for educational and entertainment purposes only. The information in this article does not constitute or is intended to be investment, financial, trading, or any other advice. The information in this article is general and in no way specific to you or any reader. Before making any financial? decisions, be it an investment, trade, or otherwise, always consult with a registered professional or financial advisor.
Delilah Brass
May 2021
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