Bitcoin\u2019s price rallied from its March and April lows. It\u2019s now down 4% from January\u2019s all-time\u00a0high.<\/p>\n
Historical comparisons for the top of similar rallies in similar conditions ranged from $87,000 to $115,000 between April and June. From that perspective, Bitcoin has done what we expected so far, albeit within a wide range of potential outcomes.<\/p>\n
With the recent surge, I hear people rejoicing in the streets, proclaiming that liquidity, financial easing, world peace, and free trade will lift the headwinds that have plagued asset markets. Once the nasty Fed cuts US interest rates, crypto will explode on a burst of new inflows and momentum.<\/p>\n
Standard Chartered apologized for predicting a target of $120,000. It is now much\u00a0higher.<\/p>\n
Do you need more\u00a0hype?<\/p>\n
You don\u2019t have to look far to find content creators more than eager to give it to\u00a0you.<\/p>\n
And why would they not? As a content creator myself, I assure you there is no downside to being\u00a0bullish.<\/p>\n
When the market goes up, your content aligns with the general sentiment. You build and grow your audience. The Internet algorithms love\u00a0you.<\/p>\n
When the market goes down, most of your audience tunes out. Those who stick around want reasons to stick around. Bearish content won\u2019t give them\u00a0that.<\/p>\n
To put it another\u00a0way:<\/p>\n
Nobody wants bearish content when they\u2019re looking to\u00a0buy.When they\u2019re looking to sell, there\u2019s no point encouraging them because once they\u2019re out, they probably won\u2019t come back to your\u00a0content.<\/p>\n
Many content creators live off their subscribers and promotional revenue, not their investment returns. They need to do what makes their subscribers happy.<\/p>\n
That means telling their audience to do\u00a0this:<\/p>\n
That approach gives you better returns than you would get with the stock market or a 60\/40 portfolio.<\/p>\n
You\u2019ll do better if you buy a fixed amount, blindly, on a fixed schedule, regardless of\u00a0price.<\/p>\n
Does that mean you shouldn\u2019t follow the\u00a0gurus?<\/p>\n
No.<\/p>\n
Find people who speak a truth that you appreciate with a goal that matches yours. Does the content you\u2019re consuming fit what you\u2019re looking\u00a0for?<\/p>\n
For example, traders want to get money out of the market. When they buy and sell, it\u2019s not an investment decision. Their goal is to get more of their government\u2019s money. Buying crypto is simply a cost of doing business.<\/p>\n
As investors, we need a different approach. We want growth. We plant during the planting season and harvest during the harvest season. We use the bad times to prepare for the good times. We use the good times to prepare for the bad\u00a0times.<\/p>\n
The trick is knowing which is\u00a0which.<\/p>\n
Tony on the TV will tell you that every time is a good time to buy. Priya in the park will tell you that every time is a bad time to\u00a0buy.<\/p>\n
When the price goes down, you think Tony\u2019s an idiot. When the price goes up, you think Priya\u2019s getting\u00a0REKT.<\/p>\n
If you obsess about finding consensus and stress about what happens from one day to the next, you make it hard to recognize the larger shifts in behavior and circumstances that frame the market and your expectations. You jump from one indicator to another, one chart to the\u00a0next.<\/p>\n
You will obsess about 10% swings in a market where 30% is normal and neither is enough to make anybody\u00a0rich.<\/p>\n
The \u201cright\u201d decision changes over time and often depends on your personal circumstances. It won\u2019t reveal itself until after you have to\u00a0act.<\/p>\n
Do you want to know what I\u00a0do?<\/p>\n
It\u2019s all in my\u00a0plan.<\/p>\n
Three lines on a chart tell you when to buy, two metrics tell you when to sell. Sometimes, market circumstances force you to deviate. I send you alerts when it\u2019s time to\u00a0act.<\/p>\n
My Plan for Buying and Selling Bitcoin<\/a><\/p>\n If you follow my plan, you\u2019re down 9% at worst, up 1,850% at best, and most likely up 200% on\u00a0average.<\/p>\n Where you fall depends on when you started, how much you sold when you sold, and how much you bought when you\u00a0bought.<\/p>\n Most of the time, you\u2019re HODLing and setting aside fresh cash while you prepare to buy more. The most recent buying window ran from the end of February to early April, but another will\u00a0come.<\/p>\n My plan doesn\u2019t apply to altcoins, but generally, when we\u2019re buying Bitcoin, you can buy altcoins, too. I\u2019ll tell you what I\u2019m doing with my altcoins in my market\u00a0updates.<\/p>\n The gurus point to various charts to explain our recent rally. We started talking about this rally in March because it fit historical patterns, technical analysis, on-chain metrics, and psychological frameworks.<\/p>\n So far, it\u2019s followed a common pattern we often see in\u00a0crypto:<\/p>\n The price goes down long enough for people to think it\u2019ll keep going lower. They\u00a0sell.Once you run out of sellers, the price goes up a bit (it has nowhere else to\u00a0go).Once the price goes up a bit, short traders get zapped, pushing the price up\u00a0higher.Once the price goes up long enough for people to think it will keep going up, they buy, pushing it\u00a0higher.Early buyers start to\u00a0sell.<\/p>\n Throw out that detour for the tariff tantrum, and you can see the pattern reflected in price movements.<\/p>\n How high will this rally go? How long will it last? When will it\u00a0turn?<\/p>\n That\u2019s the excitement. Nobody knows! We only know what to look\u00a0for.<\/p>\n The pumps in March and mid-April came from traders getting blown apart betting the market would go\u00a0lower.<\/p>\n ETFs and MSTR pumped the market in late April and early May. Throw in some short squeezes and Tether pumps, and the rest takes care of\u00a0itself.<\/p>\n We saw this in real time in my market\u00a0updates.<\/p>\n With each pump, diamond hands and OGs sold often and in a proportion larger than usual. They\u2019re still doing it now, as you can see in the 2\u20137 year realized cap HODL\u00a0waves.<\/p>\n At the same time, volume continues to fall and we see no signs of widespread engagement.<\/p>\n Still, we don\u2019t see broad selling. We\u2019re not at step 5. As a result, the market can stay afloat for a\u00a0while.<\/p>\n MSTR says it\u2019s raising $82 billion and the gurus say we\u2019ll get a rush of liquidity from institutions and legacy entities.<\/p>\n Let\u2019s hope so, because unlike 2023 or 2024, we don\u2019t have any other sources of inflows, and from the looks of unrealized profit, we have plenty of people who will sell in a panic to protect their\u00a0gains.<\/p>\n Until that changes, 2025 is a bet on the \u201cmacro,\u201d not the metrics. It\u2019s a bet on legacy financial entities, not cycle theories.<\/p>\n Mark, long-term HODLers\u00a0grew!<\/em><\/p>\n Yes, like it did at the start of previous bear markets and sometimes in bull\u00a0markets.<\/p>\n As time goes on, this chart will collect more and more inactive wallets that have no bearing on the market. Some say as many as 6 million\u00a0already!<\/p>\n I prefer a different metric that uses the realized cap filter to sift out inactive wallets and split the groups based on the price\/time they bought (e.g., 1\u20133 months, 6\u201312 months, etc). When you look at the market conditions in which they bought, you can make better assumptions about their mindset and more accurately read into their behaviors.<\/p>\n Most people use the metric above, which counts wallets that haven\u2019t sold or sent for more than 155\u00a0days.<\/p>\n People who bought five months ago bought the most recent major peak and haven\u2019t yet suffered a big drawdown. We can\u2019t read much into their behaviors. Technically, they\u2019re \u201clong-term holders.\u201d In reality, you don\u2019t know how they react to market volitility.<\/p>\n For that reason, I look at the 2+ year cohorts. That cohort has gone through the most volatility without selling, which implies they\u2019re very dedicated to Bitcoin. They form the foundation of the market. When they sell more than usual, you need to take\u00a0notice.<\/p>\n Mark, stablecoins keep going\u00a0up!<\/em><\/p>\n True.<\/p>\n Stablecoins act as a cushion when the market drops\u200a\u2014\u200aa source of natively crypto capital that can easily buy (and often\u00a0does).<\/p>\n The problem is, only Tether keeps growing. USDC is down $2 billion this\u00a0month.<\/p>\n We don\u2019t know how much USDT is real. With over $150 billion in reserves, Tether can easily float a few billion free tokens or sell them for a big discount.<\/p>\n \u201cPaolo, I need $100 million, can you spot me 100 million USDT and I\u2019ll get you back later?\u201d or \u201cPaolo, I\u2019ll pay you $50 million for 100 million USDT, sounds\u00a0good?\u201d<\/p>\n They\u2019ve done those deals before, and there\u2019s no reason they shouldn\u2019t continue doing them. Their new home, El Salvador, doesn\u2019t allow extradition, and they have close ties with key US officials. It\u2019s less risky now than\u00a0ever.<\/p>\n This makes the analysis harder because when Tether fires up the printers, it doesn\u2019t matter what you see in the charts or on-chain. They\u2019ll pump the market whenever they\u00a0want.<\/p>\n It\u2019s not just Tether that mucks up the data. Off-chain activities can change the way you interpret on-chain\u00a0data.<\/p>\n This was a significant issue in late 2021 and early 2022. We saw a lot of bullish metrics that reflected the knock-on effects of centralized lending activities and\u00a0fraud.<\/p>\n As people bought their tokens or deposited funds into lending platforms, those platforms pumped people\u2019s money back into the market, creating the false impression that everything looked\u00a0good.<\/p>\n If you looked at the on-chain data, you saw healthy HODLing, growth, and new activity.<\/p>\n In truth, centralized entities and other large actors used various sleights-of-hand and fraudulent schemes to recycle money without new\u00a0inflows.<\/p>\n I didn\u2019t put two and two together until LUNA collapsed and we discovered what was going on behind the scenes. You can\u2019t find those activities in the on-chain\u00a0data.<\/p>\n Today, we have another confounding factor\u200a\u2014\u200athough let\u2019s hope none of the fraud and shenanigans of\u00a02021.<\/p>\n The Wall Street ETFs skew every metric that uses \u201crealized\u201d or \u201cshort-term\u201d data.<\/p>\n Why?<\/p>\n Because the Wall Street ETFs account for 15 to 20% of Bitcoin activity on any given day. When the ETFs move those tokens, they do not buy and sell the same tokens they acquired for their clients. They can move any Bitcoin from any\u00a0time.<\/p>\n As a result, these metrics no longer capture genuine individual user behavior and intent. While they probably point in the right direction, their absolute values are probably not valid anymore. For each day, each variable could drift\u00a015\u201320%.<\/p>\n Look beyond the on-chain data. Incorporate common psychological and investment frameworks. Do a little technical analysis. Try to identify changes in market participants\u2019 behavior.<\/p>\n Often, there\u2019s more than meets the\u00a0eye.<\/p>\n I\u2019m seeing lots of talk about validating and invalidating cycle theories and data\u00a0models.<\/p>\n I remember how it felt from 2019 to 2022, when analysts spent a lot of time debating which model and prediction would be right. With the benefit of time and reflection, we know the\u00a0answer.<\/p>\n I wrapped this into a report, Exposing Bitcoin Data Models and Cycle Theories: Good, Bad, and\u00a0Ugly<\/em>.<\/p>\n Exposing Bitcoin Data Models and Cycle Theories: Good, Bad, Ugly<\/a><\/p>\n In my report, you\u2019ll learn what these models say and what you can use them for. It\u2019s free until the end of this month. On June 1, 2025, it will revert to premium-only content.<\/p>\n For example, stock to flow (S2F) predicts huge prices this year. Do you want to know something crazy?<\/p>\n S2F\u2019s range is so wide that you can\u2019t plan anything around it. Bitcoin\u2019s price can go 50% lower and 400% higher for months at a\u00a0time.<\/p>\n Which makes for a wild coincidence.<\/p>\n January\u2019s all-time high of $109,300 hit exactly where S2F predicted it\u00a0would.<\/em><\/p>\n S2F\u2019s creator ignores this. Wouldn\u2019t it be ironic if the one time S2F was accurate, nobody believed\u00a0it?<\/p>\n (If that seems contradictory or wrong, ask yourself why you believe in S2F when it tells you what you want to see, but not when it tells you things you don\u2019t want to\u00a0see.)<\/p>\n A big drop this summer\u200a\u2014\u200alet\u2019s say to $50,000\u200a\u2014\u200awould throw everybody for a loop. That outcome would likely come from a larger problem in the legacy financial system.<\/p>\n As such, you\u2019ll see the global money printer start up and pump the markets. Could you imagine a quick 3x to $150,000 from September to December? A re-run of the October 2020\u200a\u2014\u200aJanuary 2021\u00a0zoom?<\/p>\n This could also fit the classic Elliott Wave A-B-C correction pattern below before kicking off another five-wave uptrend as follows, with Wave 2\u2019s low coinciding with the end of 2026\u200a\u2014\u200aexactly where Bob Loukas\u2019s version of the four-year cycle predicts the next long-term structural bottom.<\/p>\n That\u2019s the amazing power of these data models and cycle theories. They all disagree with each other\u200a\u2014\u200aand\u00a0fit.<\/p>\n You\u2019ll hear people tell you, \u201cThe bears are in disbelief.\u201d<\/p>\n What if the bulls are the ones in disbelief?<\/p>\n Flip the classic Wall Street cheat sheet upside down, and the past few months look like the start of \u201cdisbelief\u201d for the\u00a0bulls.<\/p>\n I\u2019ll call this a bull market until everybody agrees it\u2019s not. For an asset that goes up 300% in bear markets and drops 70% in bull markets, you can\u2019t get so\u00a0precise.<\/p>\n Why You Shouldn\u2019t Care About Bitcoin\u2019s Bull or Bear Market<\/a><\/p>\n As long as you appreciate the circumstances, you don\u2019t need to think about bull\/bear. If anything, you should hope we are in a bear market because they give you the best buying opportunities.<\/p>\n For all assets, bear markets often start with a strong rally. The most famous is probably the four-month, 40% rally at the start of the Great Depression.<\/p>\n Most rallies aren\u2019t so pronounced. 1981\u2019s drop in the S&P 500 started with a rally of 13% and gave you two more double-digit rallies as the index fell for almost two\u00a0years.<\/p>\n When these rallies start, you can\u2019t tell whether they complete a normal correction before the market goes higher, or reflect a momentary relief before a larger downturn. You have to take a leap of faith\u200a\u2014\u200aand no guru, data model, or cycle theory can tell you how that leap will turn\u00a0out.<\/p>\n The greatest investors and traders can\u2019t get their timing right. Warren Buffett says he doesn\u2019t try. Why should\u00a0you?<\/p>\n Imagine if we do something like 2014 and range from $90k-ish to 100k-ish for the next two months. You keep putting money in expecting a huge Q3 and whatever else the gurus say. Everybody agrees with\u00a0you.<\/p>\n Then the wheels fall\u00a0off.<\/p>\n Near the end of that four-month, 40% rally mentioned above, Herbert Hoover gave a speech about how deflating the stock market shifted capital from dirty, greedy speculators to good, honest US businesses.<\/p>\n Within a year, the economy was in\u00a0ruins.<\/p>\n When JP Morgan bought Bear Sterns, Wall Street said everything was fixed. The Fed chairman told the world he could not see a US recession.<\/p>\n The Great Recession started that\u00a0year.<\/p>\n When I was in college, politicians told me the 9\/11 attacks caused the bear market in US stocks from 2001 to 2003. That\u2019s impossible. The market peaked in March\u00a02000.<\/em><\/p>\n Everybody loves a good story. Often, bigger factors are at\u00a0play.<\/p>\n Big shifts happen over months. Your Internet algorithm adjusts minute by minute, day by\u00a0day.<\/p>\n You hear somebody tell you that the last time SPX fell more than 10% in a month, then rallied to close less than 2% down, was the Great Depression.<\/p>\n Then you hear somebody say that the last time SPY erased a 2% intraday decline, it marked the bottom of the 2022 bear\u00a0market.<\/p>\n Who do you\u00a0believe?<\/p>\n My bear case for the US economy does not stem from any specific metric, chart, or data point, though I\u2019ve shared cautionary signs for months. It also has little to do with the swings in the stock or bond\u00a0markets.<\/p>\n It\u2019s simpler and less objective than that. For the past five years, three factors drove US growth: immigration, government spending, and international trade.<\/p>\n The new administration wants to get rid of\u00a0those.<\/p>\n As the president says, we will pay a \u201ctransition cost.\u201d<\/p>\n I\u2019m betting voters, Main Street, and Wall Street have mispriced that cost, both in size and duration. As a result, they haven\u2019t protected themselves and their assets from those transition costs.<\/p>\n Why does this matter for your crypto portfolio?<\/p>\n Because so much crypto activity comes from US entities. On one metric, US-based entities account for roughly 44% more crypto than the rest of the world combined.<\/p>\n As a result, we can assume any economic turbulence from the US will spill over into the crypto\u00a0market.<\/p>\n Until that changes, 2025 is a bet on the \u201cmacro,\u201d not the metrics. It\u2019s a bet on Saylor\u2019s strategy, not\u00a0ours.<\/p>\n We shall\u00a0see.<\/p>\n I treat each altcoin as its own investment and let the market tell me when to allocate. You can\u2019t judge these projects on price or news alone. No altcoin is worth the price you pay for it, though some will get so big, they\u2019re worth buying\u00a0now.<\/p>\n For example, Illuvium. Its token, ILV, underpins a gaming ecosystem.<\/p>\n On September 23, 2024, a major holder, luggis.eth, unloaded 100,000+ ILV tokens, leading to a price drop of about 7.8%. Other insiders trimmed. They\u2019ve trimmed more since then. Many staking contracts have unlocked, giving insiders free rein to sell substantial amounts.<\/p>\n Development hasn\u2019t worked out as planned, with bot activity and problems minting items on its platform. People don\u2019t enjoy the games. Setting up a wallet is\u00a0hard.<\/p>\n Hence, this:<\/p>\n Yet, the team persists.<\/p>\n Is ILV a bad project because it\u2019s down 99% from its $1,900 peak? Or does it seem that way because it should\u2019ve never gone to $1,900 in the first\u00a0place?<\/p>\n At $15, you\u2019re getting a great price to see if Illuvium succeeds. You can also get rewards from staking and contributing to liquidity pools. You can buy land and gaming items. You can even play the\u00a0games!<\/p>\n When the price goes lower, you can buy\u00a0more.<\/p>\n How much of your crypto experience comes from unrealistic expectations?<\/p>\n Crypto is a very hard market. High expectations lead to big letdowns. Blind faith leads to disappointment.<\/p>\n Too often, you get yourself psyched up or psyched out from a pump or dump, when usually those swings reflect the vagaries of the market, hard to predict and harder to plan\u00a0around.<\/p>\n Once you appreciate the circumstances, you will find it easier to navigate the ups and downs. You will recognize the value of cash. You will understand how to separate fantasy from\u00a0reality.<\/p>\n Embrace uncertainty. Focus more on your own mindset, needs, and personal situation rather than a price, time, or projection.<\/p>\n I know so many people who have stopped buying or only buy a little here or there. They expect institutions and retail to pump their bags one last time so they can cash\u00a0out.<\/p>\n They\u2019re HODLing and posting bullish content, but they\u2019ve already filled their allocations.<\/p>\n How long can the market go up when its most loyal participants no longer have the desire or resources to push it\u00a0higher?<\/p>\n A long time. You can always find a new source of money. Tether can pump at will. Without a lot of sellers, prices can\u00a0run.<\/p>\n Eventually, the sellers\u00a0return.<\/p>\n Models, cycle theories, and content creators won\u2019t tell you when that happens. Nobody\u00a0will.<\/p>\n The good\u00a0news?<\/p>\n We don\u2019t need them to. With my plan, you double your return on investment every 2\u20133\u00a0years.<\/p>\n A low expectation compared to the lofty predictions floating around the internet. Physically easy to do. Emotionally hard to\u00a0do.<\/p>\n You need patience and tolerance for big swings. You may need to stick it out for months or years at a time. It can be stressful. You will never get your timing\u00a0perfect.<\/p>\n In the end, it\u2019s worth\u00a0it.<\/p>\n Relax and enjoy the\u00a0ride!<\/p>\n Mark Helfman publishes the Crypto is Easy<\/em><\/a> newsletter. He is also the author of three books and a top Bitcoin writer on Medium<\/em><\/a> and Hacker Noon<\/em><\/a>. Learn more about him in his bio<\/a> and connect with him on Calendly<\/a>.<\/p>\n For a different spin, listen to the AI bots discuss this post on their podcast, Crypto is Easy\u00a0AI!<\/p>\n Bitcoin’s Bull Market Runs Until Paolo and Saylor Say So by Crypto is Easy AI<\/a><\/p>\n Bitcoin\u2019s Bull Market Runs Until Paolo and Saylor Say So<\/a> was originally published in Coinmonks<\/a> on Medium, where people are continuing the conversation by highlighting and responding to this story.<\/p>","protected":false},"excerpt":{"rendered":" Bitcoin\u2019s Bull Market Runs Until Paolo and Saylor Say Otherwise Bitcoin\u2019s price rallied from its March and April lows. It\u2019s now down 4% from January\u2019s all-time\u00a0high. Historical comparisons for the top of similar rallies in similar conditions ranged from $87,000 to $115,000 between April and June. From that perspective, Bitcoin has done what we expected […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-67704","post","type-post","status-publish","format-standard","hentry","category-interesting"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/67704"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=67704"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/67704\/revisions"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=67704"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=67704"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=67704"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}The data says\u00a0.\u00a0.\u00a0.<\/h3>\n
Not so\u00a0fast<\/h3>\n
Problems with on-chain\u00a0metrics<\/h3>\n
Best we\u00a0got<\/h3>\n
About that bear market\u00a0.\u00a0.\u00a0.<\/h3>\n
Imagine that<\/h3>\n
Mark, no altseason?<\/h3>\n
Worth the\u00a0effort<\/h3>\n