On The Cusp

Momentum has slowed, sell-side remains heavy, & Bitcoin is yet to reclaim the Short-Term Holder cost basis. It is time to reassess the bear case, so we can be prepared no matter which way it breaks.

G’day Folks,

There is no question that momentum in the Bitcoin market has slowed, and the price is struggling to convincingly reclaim the Short-Term Holder cost basis at $113.6k.

As we covered in our post earlier in the week, there are several important price lines in the sand, which help us visualise when, and how quickly conditions could deteriorate between here and the critical $95k level.

As you know, I always try to hold two competing ideas in mind at the same time, and I use this to establish a framework such that I am rarely surprised when the market moves much higher…or much lower.

I want to be mentally ready, and have my decisions pre-decided before big market moves occur.

The Bitcoin price is currently trading in the middle of the densest value area we have, with 30% of the supply, and 62% of the USD invested having a cost basis above $95k.

With this as a backdrop, the two competing ideas I am holding in mind right now, are as follows:

• The further we fall into this zone, the bigger the incentive for the bulls to step in and buy the dip. Unrealised losses are not yet extreme enough to break the sentiment of the bulls, and the onus is still on the bears to prove their case.

• The deeper we fall into this zone, the more coins will fall underwater, the more unrealised losses will grow, and the more investors are going to start believing the cyclical top has been established.

Today’s post is going to be a detailed analysis of the bear case as I see it. We’re going to examine how deep the cracks are in The HODLers Wall, whether investors are starting to panic, and how I am personally adjusting my portfolio given my conclusions.