BTC next leg down 29.5k and possible black swan catalysts!
After passing the 42k mark targeted back in April (see below reference), we are still in a downtrend channel. Intraday shows a bearish wedge forming - or you could call it a bear flag with a more zoomed out view. Weekly charts look terrible and while daily charts look like a dead-cat-bounced out of oversold territory. I'm expecting another big flush coming out that will potentially push to 29.5k. If that does not hold the next target would be around 23.5k. Note the very thick blue line is the uptrend line which started the original rally. We could consolidate around this line before making the next move down, but it looks like it would happen pretty soon, perhaps within the next 5-10 days.
Some other important notes to ponder here:
* MSTR owns 92k btc avg price ~~ 21k.
* TSLA owns 42k btc avg price 32.5k.
* A close above 42k would invalidate this trade.
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Other things that are generally known, but nobody is talking about yet which may act as catalysts (think black swans):
First, there is the ‘what if the devs decided to…’ question. Unlike gold (of which there is a relatively fixed amount on Earth), supply is ultimately controlled by the devs. Yes, they might just introduce or fork or whatever, but the fact that humans could directly influence (via hack or otherwise) total supply, halving, etc is a risk with catastrophic potential that does not exist with gold.
Second, there is the 51% attack. The basic premise here is that if you have more than half of the hashing power, you effectively control which transactions will go through. As of today (May 25, 2021), there is roughly 150 exahash. This is a mostly unfathomable number, but consider the following. RIOT blockchain expects to have 4 exahash online in October 2021 at a net cost of roughly $250m. On the bad assumption no additional hash power is introduced, and assuming costs remained the same, you could assume you could get 16EH for a billion dollars. For a meager 10 billion, then you could pick up 160 exahash and easily take over the network. This number while large, is within the realm of some wealthy individuals, let alone corporations and governments. Given the market cap of about 670B today, this seems like a small investment to take a big chunk. Of course, if you were discovered doing this, it would probably cause BTC to crater in price and destroy your investment. However, in todays world of high tech hacking, consider this: China (which is slowly moving towards it’s own digital money tokens and pushing AWAY from bitcoin), decides one day they want to disrupt the financial markets so they unload. A $10B hack attack to cause 670B of world economic damage? Entirely possible, however unlikely. Russia, North Korea, or your favorite terrorist organization could fit the bill here too -- Perhaps they only take over the bitcoin miner operations to wage this attack for substantially less investment than 10B. Ransomware anyone?
Third, we have whales. The small number of wallets with a large amount of BTC are easy to track and follow. However, as soon as there is some distribution out, this could have significant ripples through the bitcoin world. First, many of these coins are ‘dead’ meaning they are not actively in circulation. While the total mined bitcoin is in the 19M range, the total circulating bitcoin is way smaller, locked in these wallets. This would appear as a sudden increase in supply to the actively traded market.
Fourth, another oldie but goodie — tether. USDT claims to be a stable coin with $1 per USDT out there. But this is probably not even close to true ( research.aimultiple.com/tether/ ) The fact that lots of USDT has been used to buy BTC but may not have real dollars behind implies that the stability could come intro question if there was a mass exodus from BTC to USDT and then further to USD.
Some other important notes to ponder here:
* MSTR owns 92k btc avg price ~~ 21k.
* TSLA owns 42k btc avg price 32.5k.
* A close above 42k would invalidate this trade.
-----
Other things that are generally known, but nobody is talking about yet which may act as catalysts (think black swans):
First, there is the ‘what if the devs decided to…’ question. Unlike gold (of which there is a relatively fixed amount on Earth), supply is ultimately controlled by the devs. Yes, they might just introduce or fork or whatever, but the fact that humans could directly influence (via hack or otherwise) total supply, halving, etc is a risk with catastrophic potential that does not exist with gold.
Second, there is the 51% attack. The basic premise here is that if you have more than half of the hashing power, you effectively control which transactions will go through. As of today (May 25, 2021), there is roughly 150 exahash. This is a mostly unfathomable number, but consider the following. RIOT blockchain expects to have 4 exahash online in October 2021 at a net cost of roughly $250m. On the bad assumption no additional hash power is introduced, and assuming costs remained the same, you could assume you could get 16EH for a billion dollars. For a meager 10 billion, then you could pick up 160 exahash and easily take over the network. This number while large, is within the realm of some wealthy individuals, let alone corporations and governments. Given the market cap of about 670B today, this seems like a small investment to take a big chunk. Of course, if you were discovered doing this, it would probably cause BTC to crater in price and destroy your investment. However, in todays world of high tech hacking, consider this: China (which is slowly moving towards it’s own digital money tokens and pushing AWAY from bitcoin), decides one day they want to disrupt the financial markets so they unload. A $10B hack attack to cause 670B of world economic damage? Entirely possible, however unlikely. Russia, North Korea, or your favorite terrorist organization could fit the bill here too -- Perhaps they only take over the bitcoin miner operations to wage this attack for substantially less investment than 10B. Ransomware anyone?
Third, we have whales. The small number of wallets with a large amount of BTC are easy to track and follow. However, as soon as there is some distribution out, this could have significant ripples through the bitcoin world. First, many of these coins are ‘dead’ meaning they are not actively in circulation. While the total mined bitcoin is in the 19M range, the total circulating bitcoin is way smaller, locked in these wallets. This would appear as a sudden increase in supply to the actively traded market.
Fourth, another oldie but goodie — tether. USDT claims to be a stable coin with $1 per USDT out there. But this is probably not even close to true ( research.aimultiple.com/tether/ ) The fact that lots of USDT has been used to buy BTC but may not have real dollars behind implies that the stability could come intro question if there was a mass exodus from BTC to USDT and then further to USD.
Komen:
little H&S intraday projecting 32.5k. the 29.5-32.5k level is critical for btcusd to maintain; failing this over the next few days looks quite possible.
Komen:
daily view showing support levels around the 27-29k range, 24k, 20k. should test 29k in the next few days. after getting to 29k, i would expect a tepid bounce from there perhaps to 33-35k.
s3.tradingview.com/s...shots/g/geuKBB6p.png
s3.tradingview.com/s...shots/g/geuKBB6p.png
Komen:
getting quite a lot worse looking to me. sub 30k very soon.
