Have we seen the bottom for Bitcoin in crypto assets? Well, in this video, I’m going to share with you three simple indicators that I use to look at not only when are we actually going to time the bottom but also when we’re likely to then have that huge rally that we typically experience after a long term bear market, which usually lasts right around 12 months which we are about 13 months into.
Not to mention this really, really simple chart that you can look into at bitcoin.com if you just go to bitcoin charts. We’re looking at a two-year moving average. So anytime Bitcoin has come below the two-year moving average has been a really, really great time to accumulate. And once you get near the red or above the red, it has been a great time to realize profit. You can see you usually have anywhere between three to eight months of time to accumulate and we are deep into that zone right now. So it is a good time to accumulate.
Let’s go ahead and look more on a technical basis on an actual chart here on trading view. What I will look at is what we’ve seen historically with the bottom. So let’s ignore fundamentals because we’ll get to some of that at the end of this video. But if we’re just like technically, what we want to see is on a two-week chart. That’s what we’re looking at is Bitcoin on a two-week chart. The RSI is below this mid-range which is a 50 right so we’re approaching the bottom here which is at the 30. We’re below the 50 and above the 30 or at least somewhat close to 30. We’ve got the stochastic all the way well below the 20 almost at the very bottom here. And then we’ll also have the CCI down here. And the CCI is below the zero mark or the neutral zone; we are actually below that middle dotted line. So that occurred at the very bottom of the market here.
All right, let’s go ahead and look into the next bear market as well. This was the bottom in 2015. Same thing, CCI is well below here, definitely below the mid-range but well below. And this was really the true first bear market that we’ve seen that we can do because the other the other you know, first bull market was from one cent to you know 50 bucks or whatever it was thousands and thousands of percent gain. This one was still thousands of percent gain but a little bit less ridiculous. And this one we see the RSI approaching close to the 30. Stochastic again is well below this bottom range under the 12 20 and CCI went below the 100 mark here and then came above here.
So the question is have we seen the bottom? Well, that’s what’s happened in those two bear markets. Let’s go ahead and look here too. Same thing, stochastic is below the 20. RSI below the 50 and CCI is below the negative 100. And we’ll look at where we’re at now. So RSI is definitely below the 50. Stochastic has been below the 20 for all the way since January of 2022. So literally an entire year ago. And then the CCI was well below the negative 100 mark.
So from a technical level if we look at previous bear markets, it looks like we have actually bottomed for Bitcoin. Now the question is all right let’s say that we did bottom which to be honest I’m putting right around a 75% chance that we have seen the bottom. I have for the most part put a fair amount of my cash to work on crypto assets, not all of it but the majority of it. And the reason is because I don’t think I’m smart enough to perfectly time the tops and bottoms of markets. And I feel very, very good with everything I’m looking at on-chain and technical level to say this is at the bottom or very close to the bottom. And yes, are we at a different level you know in the macro environment than we were in previous bear markets for sure and we always will be.
But let’s go ahead and look at when the potential moves out of the bull market because if we look at the growth here… so if we grab from the bottom, obviously we’re not going to time it from the bottom. But let’s just show just the next little price appreciation over the next about year. So this is just over a year right? It was about a year and a half, 378 gain. And if we were to take it to the top of the market here, let’s say you’re a cycle like swing traders, what I kind of call it, it’s like a three-year swing trade where you’re buying somewhere close to the bottom of the barrel market and selling somewhat close to the top. This was an eleven thousand percent gain. Okay, obviously not too bad there.
Let’s look at the historically new timing of the bottom to the top. This was still right around 2,000% from the bottom to the top. And wow, that’s great. Yes, that was over a three-year period. Let’s go ahead and look on a shorter term time frame where we had a really big sell-off for that year. A bear market to the top just 200 days later was a 351 percent gain. So you see these really, really big rallies after just complete exhaustion of the sell-off of that 12 year or 12-month bear market that we typically see for Bitcoin.
All right now the question is when do we actually have confirmation that we are outside of the bottom of the bear market? What I look for is, again, the same three indicators I’m looking at. I’m looking for the RSI to cross above the 50s, so it came below that pretty much the entire bear market. When does it cross above the 50 right here okay? When this is stochastic we all also want to see the RSI above 50. we want to see the stochastic above an 80 right here all right. And then the CCI is well we want to see above the 100 here and that confirms that we’re out of the bear market and into the bull market. And then you see really big appreciation typically over the next couple of years.
So if you wanted to be a little bit more safe, you could maybe put some money to work now and then you could also kind of look at okay once we have confirmation that we’re outside of the bear market then I put more cash to work and I’m okay buying at a higher price than where we were at the bottom of the bear market a couple months earlier. But I have more conviction and confidence that we’re actually moving out of the bottom of the bear market. So that’s a strategy that a lot of really intelligent traders use, that they’re okay buying at a higher price because they have more confirmation that they have exceeded this really key level on a technical basis. And just looking at price action they can say “hey the probability that price is going up now relative to what it was even when prices were lower a couple months ago. I feel much better now because the probability is at a much higher rate.” So that’s something you have to consider in a lot of early stages investors and traders do not consider.
Same thing here: RSI above 50, stochastic above the 80, CCI well above the 100 and we went up another 200% from that mark. And now where are we at? Are we close to that? Well stochastic is not above the 50 right we’re all we’re just above you know almost approaching the 40 mark all right. So stochastic still has some room to go right. We still have to gain some strength with Bitcoin. All right, and also sorry they are not even close to the 50. It’s starting to trend upwards. That’s the important part is we have higher lows so at least we’re showing the trend of the RSI is changing which is also something that only happens at the bottom of bear markets as well. Typically with Bitcoin on these longer term charts that we’re looking at, stochastic same thing we have higher lows as well. You can see that this is trending upwards but we are not quite, we’re not even halfway there to approaching that 80 range that we want to see. And CCI just creeped back into the negative – over negative 100, between 0 and negative 100, and that is obviously not close to the top here either so we have some room to go. I think we’ve got a few more months until we see confirmation of that assuming that prices do trend upwards and we have some bullish momentum. And I think that things are starting to look like there’s a much higher likelihood that we have already seen the bottom relative to where we are at you know like two two months ago or so.
All right, another thing, some positive news, everyone is doom and gloom on the macro environment and I follow a lot of really intelligent guys that have been investing for 60 years and running funds for 40 years and very, very successful doing so. And a lot of them have said number one it’s been the most confusing time to ever invest from a macro standpoint and number two that they’ve never seen so many people all pointing to the downside. And they follow up that statement by saying a lot of the times when everyone is pointing to one direction it oftentimes goes another direction. So you know, while it’s fun to all point in one direction that the world is going to collapse, you typically see at least a very strong short squeeze when there’s an incredible amount of fear in the market. It just goes back to what Warren Buffett always states: “be greedy when others are fearful and fearful when others are greedy.”
It’s safe to say people are quite fearful, so some positive things besides being a contrarian investor number one is a dollar is rolling over right, so the dollar is coming way down which helps make it way easier for other assets to actually appreciate because everything for the most part is nominated in the US dollar.
When we’re looking at this chart, this is Bitcoin US dollar right and when the dollar falls it makes it easier for Bitcoin to rise so it’s good to see this continually falling here. We also see massive institutional adoption in this industry. BlackRock making a further move into Bitcoin by making it another portion of their $15 trillion global allocation fund which is obviously nothing to Blink an eye at but they are taking this very seriously with their partnership with coinbase and now this as well and I the list goes on and on on the fundamental adoption which is you know really really important to watch.
And then I will say also inflation is topping right and that’s really really important to see now. What I will say is we don’t and you know unemployment numbers aren’t awful but I think it is likely that we do head into a deeper recession in 2023. But again what a lot of people don’t understand is a lot of the times financial markets price in the data that everyone is projecting to happen. So while you know the economic data could be showing up you know we’ve got a deeper recession that we’re about to go into. Financial markets have already priced that in and a lot of times financial markets price you know 9 to 12 months ahead of time. So could we have a bottom at the end of this year where we head into a deeper recession and unemployment goes higher yes but a lot of that has already been priced in at the end of last year.
Now I’m not saying I’m 100% bullish. What I’m saying is I don’t think we’re going to new all-time highs in the next six months. All I’m saying is I think we’re long overdue for a significant move not only in crypto assets but potentially the stock market as well and I would not be surprised if we see a really big supply rally and then we see a deeper recession in the economy in potentially another sell-off.
In financial markets and in crypto assets, very similar to what we saw back here right the 300 percent gain and then we saw come all the way back to 3K, would not be surprised if we saw that and if we have a 300 gain in Bitcoin, even 150 percent right. So let’s just say we have 100 gains and take us back up to 32. All right, what do you think that’s going to do for some of these other coins that actually have you know the fundamentals behind them? They’ve got utility, they’ve got big firms and funds and a lot of community behind their projects. They’re going to do a lot more than just 150 percent all right.
So it’s for me I’ll probably be using that for a time to increase my cash position and also realize quite a lot of profit from buying you know where I have over the past couple months. Okay, so I think things are looking decent for a nice rally and we’re starting to show the signs that we are coming out of that bear Market that we typically see where you know we usually have 12 months after the top to you know fall for Bitcoin and crypto assets to have a 70-80% correction which we have had this year. That’s not to say we couldn’t go lower but to be honest I think we are closer to the bottom than we are to the top.
I’m curious to hear your thoughts on if you agree with me and I would like to shed some light on something really really cool that we have developed a program around which is algorithmic trading, which is one of our bots. I’ll just share one of them here. I named it the FED because it prints money figuratively. It is a beast. It ripped a thousand trades last month and is up 54,000 which is 54 over the past few months. I’ve just been tracking this on a live account since October 31st today. It already did 530 bucks profit this year and we’re only on January 9th. It has done 7,900 in profit.
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