hey everyone and thanks for jumping back into the crypto today we're going to talk about Bitcoin and we're going to be discussing Market Cycle Theory if you guys like the content make sure you subscribe to the channel give the video a thumbs up and also check out the sale on into the cryptoverse premium at intothe cryptoverse decom let's go ahead and jump in so in this video what we would like to try to identify is where in the cycle are we because it's easy to assume that this time is different it's easy to assume all
sorts of things but what I'd like to do is just go to what does the data suggest right put the narratives aside whether you're bullish or bearish what does the data suggest and let's look at the data in different ways so that we're not caught off guard right it's easy to get caught off guard and I want to go through this as systematically as possible what I would argue is is the best thing to do is to be somewhat flexible right you don't really want to you know sort of nail yourself down to a single
outcome in fact furthermore as I have stated in essentially all prior videos where we talk about Market Cycles I do not trade market Cycle Theory at all right I don't trade that at all I trade the risk levels right so as I've mentioned in 2021 one yes there was a top here but the risk levels were actually screaming that this was the top okay now as I've said before all models are wrong some are useful but most models would have told you that April was the top and not November right so at the end of
the day Market Cycle Theory is more so an academic exercise now a lot of you guys I know don't even hold Bitcoin um you're more or so knee deep in the altcoin market and you you probably wish I would spend more time talking about about the altcoin market but remember the Bitcoin Market Cycles sort of dictate what the altcoin market does so whether you have Bitcoin or not is kind of irrelevant it is still useful to understand the Cycles just so you know right is there upside for your altcoin or is there not okay so
we're going to look at this in a few different ways and I'm trying to you know I would like to argue don't get married to any single outcome we always must respect what the market is telling us all right the first place to start right the first place that I think we should start is go look at just the ROI of Bitcoin from the low right it's easy for anyone to say this time is different and everything else but let's tune out the noise and say let's just look at the ROI of Bitcoin at as
measured from the bottom now if you're new you're probably wondering well what low am I even talking about well Bitcoin has this cyclical component to it where it tends to bottom out in Q4 of the midterm year in 2014 it actually technically bottomed out in January of the prehab year but it was still around Q4 of 2014 here's Q4 of 2018 and finally Q4 of 2022 so you can see you know this cyclical component of Bitcoin where you get Market cycle bottoms around the end of the midterm year right Q4 2014 Q4 2018 and finally
Q4 of 2022 and remarkably you've also seen peaks in Q4 of Po having years right so you have your Q Q4 sorry you have your your Q4 of um I can fix this let me go here so you have your Q4 of 2013 right and that was your your your first major one right there and then you have your Q4 of 2017 and then finally you have your Q4 of 2021 right so you can kind of see what I'm talking about right where you have these Peaks that are separated by about 4 years right and
the bottoms that are separated by about four years approximately okay so if this continues to hold true then it would mean the next bottom right whenever you know whatever the price would be no one knows what the price would be and we don't technically know when it would correspond in time as well but if it were to play out the same way as it has previously it would mean that the next low is sometime out in say Q4 of 2026 okay now again markets can change obviously and no one knows exactly how things are going
to play out but if history were to repeat itself it would mean that the next Market cycle bottom would be in Q4 of 2026 and the next Market cycle top would be in Q4 of 2025 right so that's essentially what it would mean and and and you you know you would essentially you would basically have and I don't know exactly where it would correspond to right but you would basically have sort of a top uh in in Q4 of 2025 and then some type of low in Q4 of 2026 and that way you basically just
continue this pattern right that is one Theory okay and look it's a compelling one no doubt about it right no doubt about it for everything that feels like this time is different when you go look at the ROI from the bottom and you look at the ROI today compared to the last couple of Cycles it's right where it always is in fact it's actually outperforming the 2016 2017 cycle as measured from the bottom it's underperforming last cycle as measured from the bottom in fact at this point last cycle Bitcoin was up about almost 12x from
the low this cycle at this point in the cycle bitcoin's only up a little less than 7x whereas two cycles ago Bitcoin was up about 5 and a2x at this point in the cycle so for all the reasons why every cycle can feel different when you look back at this chart I guess the the question is well show me on the chart where it is different and you could argue that so far it has not been different and so if you look at the last two Cycles you can see that last cycle topped after um
1,60 days from the bottom two cycles ago topped 1068 days from the bottom and we're currently sitting at 758 days from the bottom right so this is your normal cycle your normal 4-year cycle where you have a uh a right translated peak in the cycle right so where the low occurs way over here about a year after the top and then you spend basically the next three years going up so one way to visualize that right if we were to take a uh a rectangle here one way to visualize that is to look at it
you know sort of from the lows right so we're going to go um from the low to the high and we'll mark that with a green box right so we'll do it for every single cycle the low to the high and really you know this first low You could argue was I mean if you go back to this would be you know December 2014 so the the the one previously would just be December of 2010 right which is right here right I mean or sorry that's January 201 I guess December of 2010 uh is right
here right here so again you know it's it's a little squirly over there um but you get the idea right you sort of see most of the upside occur during those three years and then you get your onee bare Market okay so let's highlight this so that everyone can see what I'm talking about as it relates to bitcoin uh Market Cycle Theory right so you have your boxes like that okay so this is what a typical fouryear cycle looks like where you have a right translated Peak where the peak occurs just one year before the
bottom you see it it's pretty obvious how how the Cycles have historically worked out and so that is why there is a lot of speculation that the next Peak will be sometime late 2025 right you know some people say December 2025 some people would say you know November I've seen some people say you know as early as uh September or July and then furthermore you have people that even suggest it could come sooner right now I would argue that if it comes in the second half of 2025 like it always has then it's just a
typical right transl ated cycle where then you get sort of a one-year bare Market in the midterm year that is what has historically happen and therefore I think there is a sufficient amount of weight to put behind that idea right you know why try to over complicate something when it just keeps doing the same thing with that in mind though it doesn't mean that you shouldn't be prepared for other outcomes and so what I'd like to do is say all right well look this seems to be a likely outcome right just repeat what it's always
done if it's not broke don't fix it but last cycle a lot of people were called off guard you guys remember because the top sort of occurred in April now technically speaking Bitcoin did sweep the high half a year later but for all intense and purposes I mean Bitcoin topped in April of 2021 that was when social activity topped that was when onchain activity topped it was basically when everything else topped except for the actual price of Bitcoin right it's kind of remarkable and and you can actually observe that fairly well I mean if you
just go over here and you look at at the social risk for instance you will see that the social interest in crypto really topped out early in the year and ever ever since then it's you those lower highs if you were to go look at say the uh some of the onchain data right if you go look at at say some of the the the Huddle waves the hot ways right whatever you prefer if you were to go look at long-term holders they were selling into the first Peak not really the second one right and
so that is a lot of evidence to suggest that April was actually the top not November one really interesting thing about what happened last cycle is what normally happens is Bitcoin goes to the 50e moving average and when it hits the 50e moving average average historically the cycle is over but the market starting to change a little bit because look over here in 2014 right in 2014 you can see that Bitcoin hit the 50e moving average and then it got a deadcat bounce to a lower high okay and then the the the party was over
right once the 50e moving average was tagged the party was over go to the next cycle here once the 50e estimate was tagged it meant the party was over and you can also see that it tagged it around the same time right March of the midterm year this was also March of the midterm year right March April of the midterm year the year after the post having year and it meant the cycle was over even even the 2019 rally right even the 2019 rally once you went back to the 50e SMA you got a little
bit of a bounce and then we got our uh the pandemic induced recession right last cycle is where things changed a little bit we hit the 50e moving average and it made a lot of people believe that the cycle was over right it made a lot of people believe the cycle was over and you could argue that realistically it was you know Bitcoin did go a little bit higher but was it worth the risk and I think that's the question was it really worth the risk Just To See It Go say like 5% above the
prior all-time high you know would it have been just better to sell here because that was what the risk metrics were saying the risk metrics were saying sell there um so this is kind of what I think got a lot of people off sides last cycle is they thought this was they thought the market cycle was over in April it came back down hit the 50 we moving average like it always does but then it went to a new all-time high right so what's really interesting is this cycle Bitcoin has already tagged the 50e moving
average you see that and it's gone to a new all-time high so what I'd like to do here is think about this in a different way right so what I want to do is remember historically Bitcoin tops out in Q4 historically and there's a good chance that happens again but again I don't trade market Cycle Theory I trade the risk levels and I will say that over and over and over again I trade the risk levels not Market Cycle Theory but listen let's go through an exercise where we take this as the top and not
this it seems absurd right it absolutely seems absurd and one of the reasons it seems absurd is because at the end of the day price action is King right who the hell cares what indicators are saying price action is King right so 69k was the top right it wasn't 64k it was 69k and so you could argue that why why measure it any differently you know this bare Market in 2022 looked the same as the 2018 bare market and it looked the same as the 2014 bare Market in fact if you look at year-to dat
Roi of Bitcoin in bare Market years 2014 2018 2022 they look nearly identical in fact you know how we've averaged out prior having years to give us an idea as to where Bitcoin might end this year right we've done that before we looked at the average 2012 2016 and 2020 and then we just overlay it with Bitcoin in 2024 and remarkably it's still tracking it one of the things and also by the way Bitcoin has been tracking just what it did in 2023 right remarkably right it's just tracking what it did in 2023 and so
what I think is interesting is if you average out 2014 and 2018 it basically told you exactly what was going to happen in 2022 right exactly where the price of Bitcoin would end up at the end of the bare Market year you see that I think that's interesting but I really think that that was fairly interesting that it it it ended the year sort of the average of the last two midterm years so sometimes just averaging this stuff out works out quite well but what if we were to look at it in the way that
I just mentioned where instead of taking November as the top which is dubious absolutely dubious to not just take November as the top especially when it looks very similar right when you go look at at the ROI uh from the low it looks like we're on track like we always are in fact if you measure if you look at this cycle compared to two cycles ago how can you not see the similarities right it's nearly identical right look at Roi after cycle Peak so if you look at the ROI after cycle Peak and you go
Peak to Peak we're actually still tracking last cycle right now right this is basically as measured from the peak bitcoin's up the same amount it was at this point last cycle as crazy as that seems if you compare it to two cycles ago it's actually still quite ahead of where it was two cycles ago if you take November as the top but if you take April as the top and not November then you're all of a sudden right you're about 6 months further along right and so we can do that switch it to April now
you see the change here look at the uh structure of this he here the low you there was a low in June and then a slightly lower low in November if you take it as measured from April even this little move right here looks the same right this the sort of the dead cat bounce you guys remember when we were talking about that dead cat bounce off the 50 we moving average in uh you know two cycles ago right here right you guys remember that dead cat bounce kind of looks like the same thing right
it's just that it somehow met it somehow went to a new all-time high right so look at that the deadcat bounce in 2021 led to a new high but it it almost perfectly matches the dead cat Bounce from the cycle before and then they rolled over together and then there was this low around the same time right you see that and then there was another low way over here and then the the Cycles started to move up together now if you look at it this way you could argue that we're actually much further along than
we might actually believe we are because it's only reasonable to assume that Bitcoin could top when it always does right in Q4 of the post having year Q4 so December November October even though it's never I don't think it's ever actually peaked in October but Q4 of 2025 or sometime around that I mean it could be a little bit earlier could be you know July August September right A lot of people are calling for that as well um if you measure it like this what does it tell you well if you measure it like this
and you go Peak to Peak right you look at at the last two peaks last cycle would have only lasted if you if again if you're taking April as a top it only lasted uh what was that 1214 days two cycles ago it lasted 1473 days and the current cycle is already at 1344 days so if we're already at 1344 and last cycle went out to 1473 that doesn't get you as far out as you might believe if you were just measuring it as November as the top right so you can see there is you
know there is in fact a a a clear difference right between whe whether you measure it as you know from April or if you measure it from November so what do we have here right we have one option is a right translated Peak right or right translated cycle I guess where you get it in Q4 of 2025 okay you could argue that you get a right translated cycle that comes a little bit earlier than that right sometime in 2025 uh let's say the second half of 20125 either of those I think would just be considered
a right translated cycle whether it comes in Q4 or just sometime in the second half of 2025 right it could be Q3 as well that would be a normal cycle and it would also potentially set the market up for its typical midterm year bare market right and that would be 2026 seems like an outcome Tock and it seems like a likely outcome right the other View is you get a left translated cycle where you get a peak as early as Q4 of 2024 or q1 of 2025 this is not going to be as popular of
a view right it's not going to be as popular of a view but it's at least something we should consider right it's not something to take to the bank and ask them to cash it in because they're just going to roll their eyes but it's something to at least consider consider and the only reason I mention it is because there are some elements that you could argue kind of line up for something like that especially if you measure it Peak to Peak especially if you measure it Peak to Peak and you measure it from the
April top instead of the November top the other thing that I wanted to mention is there's a couple there's a couple of cases in the past that look a little similar to it and that would be sort of two examples right one example is the QQQ and we've talked a little bit about the QQQ the QQQ launched in 1999 and it launched in March and and when it launched you can see that after launching it launched it hit a low of around 48 Bitcoin when the ETF launched hit a high at a local high of
around 48k so it makes the comparison really easy they both launched around the time that the asset that they're following was at 48 right so the QQQ 48 Bitcoin 48k the QQQ had a drop in early August and had a higher low in mid October doesn't that sound familiar right in in Bitcoin remember it launched the QQ or sorry the the when the spot ETF launched for Bitcoin it launched here at 48k and then it had a low in early August right and then a higher low in mid October early to mid October and furthermore
what's really spooky and almost feels like a simulation to some degree the QQQ broke 100 here that week right there February 7th when the QQQ launched it took 48 weeks to break through 100 48 weeks if you go look at Bitcoin how many weeks would you care to guess it took to break through 100k from when the ETF launched it took 47 weeks almost identical number of weeks 47 weeks for Bitcoin to break through 100K 48 weeks for the QQQ to break through 100 almost identical but the QQQ did not top at 100 in fact
it continued to go up for 54 weeks from when the ETF launched now what's remarkable about that is that 54 weeks after bitcoin's ETF launched would actually occur would correspond to election day or sorry not election day Inauguration Day January 20th the day that Garett ginzler resigns and so again I'm not asking for it to be your base case but I I don't want people to go into it assuming they know when the cycle peak's going to be because I have to imagine that when the QQQ topped in March of the election year it probably
took a lot of people off guard right it probably took a lot of people off guard and and and kind of surprised them but here's the thing even if that does end up being a top for Bitcoin the market didn't know it until half a year later let me show you what I mean when the QQQ hit this level it went all the way up to 120 right 120 so for Bitcoin that would be about 120k what's interesting is if you measure out year-to-date Roi for Bitcoin in 2024 and you average out just prior having
Years 2012 2016 and 2020 they average out to be about 3x from the yearly open well 3x from the yearly open for Bitcoin is about 120k right so it seems kind of similar that doesn't mean that Bitcoin has to stop at 120 exactly there are some differences between the launch of the ETF for Bitcoin and the QQQ right when when the QQQ launched 48 was the low when bitcoin's ETF launched it was sort of a surge into a high and then the low ended up being 38 not 48 right the low was 38 and that's
one of the things I'd like to mention the volatility for Bitcoin has been a little bit different right so for for Bitcoin the low was 38 after the launch for the QQQ the low was 48 the August low was 57 for the QQQ but for Bitcoin the August low was 49 okay the March high was 73 whereas over here the the marchapril high was only 56 so it's not an exact comparison so the extremes can be different right it could go higher or you know the volatility could in fact be different but what's interesting is
that the QQQ a year later went to 120 and then it got a massive selloff back to 63 think about that 120 to 63 in about 3 to 4 weeks about 1 month or so just to give you an idea of what that would look like for Bitcoin um and again I I don't even know that this is the most likely scenario but it would basically look like retesting that trend line there sometime in 2025 because the QQQ got that correction a year about 54 weeks after the launch of the ETF it finally had a
larger correction and that correction ended up being about almost a 50% drop right so if Bitcoin were to go to 120k or thereabouts and then get a 50% drop I mean it would basically put you at retesting that trend line that it broke out from so here's the thing though when it when the QQQ did that no one knew that that was the end right I I have to imagine a lot of people were still fairly bullish because there was a low put in in in April but then there was just a higher low put
in in May and then another higher low in July now remember for Bitcoin throughout the last couple of years when Bitcoin put in these higher lows it occurred in Q3 right Q3 there and then Q3 right here right this was July this was August so if it were to follow something like that it would still look like a fairly normal cycle even as far out as September of 2025 it could just then resolve to a lower high and then go down in Q4 2025 rather than up okay so that's at least another Cycle Theory to
at least be aware of not saying it's the base case I would say it could turn into the base case if you get a big drop like this sometime out in 2025 here's the thing though normally Bitcoin gets a correction in q1 in January of the post year so that's what I would be looking towards to figure out is it a normal cycle or is it a left translated cycle because in a normal cycle Bitcoin would get a January correction of about 30 to 40% it got one January 2021 it also got one in January
of 2017 if you go look at January 2017 um right here Bitcoin got about a 30 to 40% drop so I would argue this I would argue that whenever this sort of this maybe January drop or potentially February January February it whenever that drop occurs like historically it has does it result in say a 30% drop maybe a 40% drop where potentially it just finds support at the bull market support band right you can see that it it has historically found some support there at the first time it tests it does it find support at
that level if it does then there's a good chance that Bitcoin just continues its normal cycle with topping in Q4 of 2025 if it's a larger drop like a 50% drop where it comes all the way back down to retest this trend line that could be a little bit more concerning and then thus make you question whether it's a normal cycle or if something different is in fact happening there's one other comparison as well that I I think is worthwhile to mention and that's not just the QQQ because that's just sort of one launch and
you know you you could also look at the Gold ETF launch and say that it stayed in a bull market for years so why can't Bitcoin just follow that but if you look at at the S&P 500 we know this has been an inflationary cycle and so I think the best thing to do is to go back to the last period where we had sort of some inflationary times and that was all the way over here in the 1970s so if you overlay the US inflation rate year over-year one of the things you'll notice is
that in the 1970s the market also bottomed out in October right you see these bottoms uh by by the S&P right or sort of like you know in in in the midterm year right this is 1962 so you have 1962 1966 1970 right same thing as today right I mean the fouryear cycle is still was still well alive back then as well where the market tends to show a lot of weakness in the midterm year 1966 1970 and 1962 and also 1974 right every midterm year we saw the S&P stuck in traffic on struggle Street
back then and arguably it was because of these inflationary impulses that the market was having to deal with but what's really fascinating about these tops is that they were not your typical right translated cycle tops right remember the right translated cycle means it tops only about a year before the bare Market low these tops occurred two years approximately before the bare Market low and they occurred in January this one occurred in January of the inauguration year right I mean it it it occurred in the post having year in January and the cycle before that it
occurred in December November December right so this is what a normal right translated cycle would look like right where the market trends up for three years and then drops for one or so but this is what a left translated cycle would look like where it only goes up for two years and then drops for two years do you see the difference rate where it goes up for two and then drops for two rather than go up for three and drop for one so this is why this whole Cycle Theory stuff is important and it's important
to recognize what has happened in history not to say that it's going to repeat that but just to say that look it's something to keep on your radar now right now I am not that a you I'm not as concerned about another inflationary impulse one of the reasons for that is if you look at the unemployment rate back then when you did get the secondary inflation impulse right where inflation really started to go back up it was while the unemployment rate was going down right so inflation was going up unemployment was going down here again
unemployment was going down inflation was going up but we're not seeing that this time right we're seeing the the you know inflation's going down and the unemployment rate's going up right so it's it's a little bit different than the 1970s it's the unemployment rate that's going up right now not inflation I mean inflation's gone up a little bit recently uh but it's not you know it's not as it's not looking exactly like what it looked like back then in fact if you look uh if you go check out uh inflation year-over-year what you'll notice is
that back then it bottomed out in the summer of the election year right just below 3% and then it started to slowly Trend back up but it wasn't until just before you got a big move in inflation like a 1% jump in a month that the market really started to struggle again so here you know initially though while inflation was going back up right initially while it was going back up uh the market didn't care right the market was going up too but once you got a bigger move up that was when the market sold
off here you're starting to see inflation go up a little bit Market doesn't care right because it's still not a big move up in either the inflation rate or the unemployment rate right it's been relatively tame so I would keep an eye on that as well you know do you get a repeat of the 1970s doesn't really seem like this time is exactly the same thing with the unemployment rate trending up whereas back then it was trending down but is at least something to consider as an outcome that you know could happen uh next year
so sort of recap here we have a typical cycle right we have a typical cycle a right translated cycle with a peak in Q4 of 2025 this is what would happen if history repeats itself perfectly again if it's a little bit different it could be say like in the just the second half of 2025 maybe it comes as early as July August September I know a lot of people have been throwing out July August September as another likely outcome so we're putting that up there as well it's important you know when you do a literature
review if you're if you're going to study a topic right you know when I went to grad school if you're going to study a topic you do a literature review you see what what are people calling for right what are people saying and and then you know talk about that because those people could very well be right and then you look at also a um uh sorry this is a a sorry right translated cycle um right translated cycle and then so number three would be sort of a left translated cycle where you get a peak
as early as as Q4 2024 SL q1 of 2025 right that is an option not a popular option but it is it is an option to at least consider and and you can kind of see like the evidence for all these different outcomes right you can you can see the evidence for a peak and Q4 of the post having year right I mean like why why over complicate things especially when the cycle Roi as measured from the low you know just looks like this right why over complicate things it's just doing the same thing it
always does but so what if there's a correction in January so what you could argue that a correction in January 304 30 to 40% correction in January would actually be quite healthy if it's more than that right if it's a 50% correction that would maybe imply that the music is starting to stop but if it's just a 30 to 40% correction the Market's just doing what it always does um so in this case I would say you know if it's not broke don't fix it if the Market's falling what it always does why over complicate
things obviously there's reasons to assume that it could play out somewhat differently right and and those reasons are not just looking at the S&P and the unemployment rate and inflation but obviously you know talking about sort of the elephant in the room right and that's just the uh the the yield curve right the yield curve you go look at at treasury y spreads um and you look at the unversioned process of 3-month and 10e yield it is happening right now right you can see that the uninversity now and historically that's when you get recessions but
here's the trick though just because you get it uninverted does not mean it it does not always mean recession now sometimes it means recession later right for instance in in 2007 the yield curve the three-month and 10e yield uninverted in May but you didn't get a recession until November so about half a year later the cycle before that the Y curve un inverted in January the recession was only about 2 months later but in 1980 to 1989 the Y curve uninverted and and it took a year right it un it first uninverted sort of like
August of 89 or so but you didn't get a recession until July or so of 1990 so even when you see that process play out it doesn't always mean the recession is immediate even if you get one it could still be a year away in fact there's one example in the 1960s where you had an inverted yield curve in 1967 it uninverted but you still didn't get a recession for 2 years right and back then though even though the recession was two years away the market actually topped in December of the election year right and
that was sort of a a a left translated Peak right a left translated Peak so if it's a normal cycle if it's a normal cycle which is what everyone hopes for right that's what that's what but you know that's how you make your the money right is if the cycle just lasts for another year if it's a normal cycle there's still going to be some drops along the way historically it would mean we get a drop in January right that would just be a higher low if it's a normal right translated cycle if it's a
left translated cycle then you would need to start looking out for potential Market cycle tops sooner but we've talked a lot about this M Market Cycle Theory stuff right you don't have to ultimately know exactly when it's going to occur to take advantage of it whenever it does occur as I say don't ever let a good bubble go to waste right no one knows exactly how it's going to play out don't let it go to waste if it plays out at a different time frame than what you are thinking so that's why we talk about
some of these other indicators right like your your P Cycle top indicator and I'm a little concerned that you know a lot of people are are are looking at some of these indicators but they're not looking at sort of what's under the surface if you divide the moving averages you can can see the diminishing Peaks on this right so it you might even not see the signal flash this time just because of those those diminishing those diminishing Peaks right instead of going to one which is normally what it would need to do to trigger this
indicator it might top out at say 0 n or so I would say about 0. n could be a market cycle top right now it's at 0 58 right but it's starting to move up here right I mean just uh a month ago it was at it was at um 0.53 now it's at 0.58 if it continues to move up like this it's only going to take a few months for it to get to 0. n especially if Bitcoin continues to accelerate to the upside like it has been so I would look at things like
that right look at at other models right like the stock to flow model even if you disagree with it who cares right I mean the the stock to flow model has certainly been helpful but look at at at how it gets closer to this line and now it's spending more time below that line so take the deflection from it and look at the peaks look at the diminishing Peaks and when it hits that so that is what I think you should look at um there's a lot of different ways to view the market right a
lot of different ways to view the market and it it could be a right translated Peak like normal it could be a left translated Peak just to throw us off course um if it ends up being a left translated Peak then perhaps last cycle was the warning for it right where you got a top in April that was basically the same top as the one that came half a year later right so if you know if if it were to play out say like the QQQ did where you get a top early on in the
year in q1 and then it drops in Q2 Q3 everyone thinks it's going to go to a new high in Q4 and then it ends up being a lower high right that's what happened with the QQQ back in the year 2000 right where it you know it basically put in a top and then it started to trim back up I'm sure a lot of people were hoping for another rally in Q4 of of the of that election year but it ended up just being a lower high and it ended up being a less translated cycle
in the short term though obviously you know momentum has certainly been on bitcoin side again year-to-date Roi is still just tracking what it did last year again if it's not broke don't fix it and and it's also tracking the average of Prior having years right so you know if Bitcoin gets up to like 120 130 140 or something and we're looking at these indicators and it looks like those diminishing Peaks are hitting and the wrist metric is screaming you know this is the time then it's possible you could get a peak sooner the other thing
to look at that I think is is kind of interesting is is just looking at something as simple as the RSI but on longer time frames now the weekly RSI there the twoe RSI is one of the things that helped us identify the midcycle top earlier this year it wasn't I mean the RSI was more so used for Confluence it was mainly because gold was breaking out and that's what marked the midcycle top last time uh but if you look at the twoe RSI you can see that it's essentially putting in these lower highs and
it's also putting in lower lows and you might notice that it already tag this trend line but I said I didn't think that was the market cycle top but it looks a lot like 2013 right where you get sort of an early top you get a low right you get this low right here and then it goes back up and puts in another top but if it does if 2024 is just repeating what 2013 did then you could be sort of seeing things accelerated by a year but what I would look at more so than
the two-e RSI is the monthly RSI right take a look at the monthly RSI the monthly RSI also shows these diminishing Peaks and lower lows right so if at some point this cycle we're all sitting here and we're looking at the monthly rsis at 90 or something and the P Cycle top indicator is at the moving average division's at 0.9 and the risk metrics at 08 or something or 0.9 and the stock to flow deflection is at a lower high right if everything is lining up then it doesn't matter what month it is doesn't matter
if it's this month January February March April May June July August September October November December right it doesn't matter what month it is it's just when it happens don't ignore it and that's I think what a lot of people sort of you know you know are are sort of fall victim to is they get in their mind when it has to happen and so they're not willing to see it any other way and I've fallen for that as well right I'm not saying it as sort of like oh I'm blaming you this is on personal
experience right you know you learn from your mistakes you don't get married just like you don't marry an altcoin because it's going to take more than half in the divorce don't marry a price prediction top a timeline don't marry it be open-minded to your view being right but also say you know what if if there's a move before then I don't want to ignore that and if there's a move after what I think I don't want to ignore that either right it's like in 2021 I certainly didn't think that 64k was the top in April
and I thought the cycle was going to was going to last a lot longer but I still sold I I still sold a decent amount of Bitcoin here was like 87% right cuz it was the the rist metric back then was at 0.95 or something ridiculous right if you go look at historical uh risk on bitcoin it went to the highest wristband in q1 of that year not over here right so it was all about I don't know when those Peaks are going to occur right I don't but the great thing is you don't have
to know it's just about whenever it does happen don't let the bubble go to waste right and that's why I say don't ever let a good bubble go to waste even if it happens on a timeline different from what you are in fact expecting so that's sort of a a a general thought process as to where are we in the market cycle I think a lot of it depends on what happens here in the next like couple of weeks or so you know next few weeks as Bitcoin accelerate into into the end of the year
does it accelerate into January and February where it's just going crazy and all the indicators screaming this is the top or is there is there a pullback at some point when we least expect it right there's always a chance that happens too what the and there's only I can't find a lot of evidence for that but there's one thing to consider I mean the bank of Japan is going to be meeting tomorrow as well as the fed and giving us their interest rate decision obviously it seems like the fed's going to cut seems like the
bank in Japan's going to stay constant but if they raise rates that could be a a negative for risk assets okay and it could actually help delay the uh the overall cycle because again if you look at at at at Bitcoin and you were to Overlay not us interest rates right but if you were to Overlay interest rates over in Japan some you guys were like why does that matter because there's a carry Trade A lot of people actually borrow over there because the interest rates are a lot cheap a lot lower the cost of
money over there is a lot lower so you have this carry trade but you can see right the last two times at the bankage pen raise rates there was a correction in the markets right a couple of weeks later right the bankage pen raise r rates in March and then you got sort of an April correction they raised rates in July and then Bitcoin got an August correction so if they do raise rates in December that could lead to a January correction now the market is suggesting they're not going to raise rates in December tomorrow
so there's a good chance they don't raise rates tomorrow and they delay it until January or March the next couple of meetings but if they do raise rates tomorrow that could lead to a negative outcome for risk assets um but again it doesn't really seem like that's the most likely outcome but I'm also not in the mind of the people that are working over at the bank of Japan the other thing to consider right is if there is a pullback in the market even if it's a sharp one it doesn't even mean it's the it's
the cycle top and you know we were just talking about the QQQ during the dot era right we're just talking about that go look at the S&P during the Doom era and and actually look at it through the lens of of M2 if you look at it through the lens of M2 one of the things you'll notice is that the S&P actually got a correction around this point right and and you can see to some of these lows by the S&P this again this is the S&P divided by M2 right you can kind of see
some of the similarities between these these sort of these lows and these highs um in fact right here if you look at at sort of this low right here in 1996 kind of corresponds to this low here in in October 2022 and we just made it up to where the S&P with respect to M2 made it to in July of 19 98 right we're at that same level now so if there is a unexpected correction just when everyone doesn't think it's going to happen it might feel like the Cycle's over but there's still a chance
that it's not right and look what happened over here in 1998 there was a big correction by the S&P divided by M2 I I mean it wasn't a huge correction I think it was like a 20% drop it probably felt like the cycle was over but then it just accelerated again and the party went on basically from you know from 1998 October 199 1998 until basically a year and a half later so you have to consider that even when it seems like things are obvious you can get Corrections out of nowhere now that correction occurred
during a midterm year which is when Corrections normally occur so this is not exactly the same thing but there's no denying that there's some there's something to be said about sort of these highs against M2 right and these lows against M2 right the low from 1996 was the same low that we saw in January 2019 and the same low that we got in November 2022 and these highs by the S&P divid M2 were the same Fe you know February 2020 January 2022 even around July 2023 we got a pullback and then it blasted through now
it's gone all the way up to where it was in October of 1998 what's really fascinating about that move by the S&P back over here is that when when it got this drop the FED cut rates in response to that drop from 5 a half% to 4.75% exactly what they've done today so far right the market interest rates dropped right here from 5 and a half you can see on this YX right here five and a half down to 4.75 but it was in response to the drop this this drop here by interest rates has
not really been in response to a drop it's more so trying to you know make a change before there's a drop so it seems like it's a little bit more sort of front running things right the fed's trying to get ahead of things before things start to get too bad so that's where I think we are guys I mean there's a lot of different ways to view the market cycle obviously I'm trying to come at this without a bias I think it it's hard to do it sometimes but look at it without a bias respect
the right translated Peak respect there's a chance you get a left translated Peak respect the fact that none of us have any idea what's going to happen but I think the best thing to do is just react to the data as it comes in and if you see those moves make sure you take advantage of it and don't let it come to pass just because you're married to the idea of your timeline if you guys like the content make sure you subscribe to the channel give the video a thumbs up and again check out the
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