Bitcoin Is Near a Key Turning Point. Here's What Comes Next
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| By Juan Villaverde |
The question on just about everyone's mind this week is simple: Have we finally confirmed Bitcoin's 4-year-cycle low?
Short answer: Not yet.
Let's start with timing: According to JpM2, this rally — which started from Bitcoin’s June 25/July 1 low — was scheduled to end July 29.
Stretch that window a bit, and the outer edge is Sunday, Aug. 2. My Forecasting Model — which has a slightly wider margin of error — says around Aug. 7.
Put together, we're looking at a top forming between July 29 and mid-August, a window we’re right in the thick of.
Here's what's actually happened: Bitcoin reached $67,000 on July 21, then traced lower into the start of this week. It dipped back to around $63,000 on Tuesday, before bouncing to roughly $64,000, where it sits as I write.
Which brings us back to the big question: Have we confirmed the 4-year-cycle low?
Well, we came close. Very close.
The green downtrend line (below) is currently near $66,000. Bitcoin's July 21 rally brought it near. But not quite close enough.
Bitcoin On the Verge …
Remember: This isn't about touching or briefly tagging the line. Bitcoin needs to rally and hold above it. That hasn't happened.
Is it still possible? Yes, I believe so.
We're squarely within the time band where a top is expected. That means we still have some runway — a week, maybe 10 days at most. Which means it’s possible for Bitcoin to have one last leg higher before the correction that’ll take us into the fall.
Within this window, all it would take is a quick two- or three-day push to carry Bitcoin back above that $66,000-and-falling threshold. That could potentially be sparked the Fed not hiking rates this week or some positive news on the geopolitical front.
Even if such a catalyst evoked no more than a knee-jerk reaction, that would probably be enough.
Even so, I wouldn't take it for granted. Since July 21, Bitcoin has been selling off, not rallying. And we need another leg up for this to happen.
It may come. It may not. But I think there's a real chance Bitcoin mounts one more push, potentially back up toward $68,000 to $70,000 before it finally tops out and enters the two-month-plus correction. With a low forming sometime in October.
I repeat this every week for a reason: The early August to mid-to-late October correction is going to come regardless.
What we're actually trying to determine here isn't whether Bitcoin corrects. It's whether Bitcoin breaks below $60,000 during that correction or holds above it. That will give us a hard floor for the coming correction and help my model pinpoint the best time to buy even faster.
The deciding factor for that is whether Bitcoin crosses this green downtrend line before the top is in.
That’s what I’ll be watching for over the coming week.
Best,
Juan Villaverde
P.S. I told my Weiss Crypto Portfolio members that my Crypto Timing Model has us keeping our powder dry until that bottom is confirmed. This way, we stay out of near-term weakness and can start the next bull run from a position of strength.
If you’re looking to increase the powder you have available before the next buy opportunity, I suggest you check out our Friday Income Machine.
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