Ballparking Bitcoin Bottom

For every four years, bitcoin price repeats the cycle of halving, bullish run and bearish decay. The fundamental of supply and demand have not changed since the genesis block. Here I make an educated guess of this cycle’s bottom: where, when, and what to do. Not financial advice.

Plot BTC/USD on weekly, log chart

The vertical line shows the months of halving and the origin of the Fibonacci retracement, with the highest point given as the candlestick body (not wick) of the historical highs. Any trained eyes will immediately catch the popping fact, that the 78.6% Fibonacci retracement has been the bottom of the previous two cycles.

In the first halving of 2012 November, BTCUSD shot from 11 (halving origin) to 1123 (highest high), followed by a 13-month decay to 78.6% retracement of 250, stabilized for couple of months, till the second halving event.

In the second halving of 2016 July, BTCUSD shot from 570 (halving origin) to 13874(highest high), followed by a 13-month decay to 78.6% retracement of 3411, stabilized for couple of months, till the third halving event.

In the third halving of 2020 May, BTCUSD shot from 8700 (halving origin) to 61634 (highest high), formed a double top pattern, with future to be unfold. If history repeats itself, then likely the 78.6% retracement at 19970 is this cycle’s bottom. If it occurs 13 months after the first top (April 2021), timing would be June 2022. If it occurs 13 months after the second top (Oct 2021), timing would be Dec 2022.

What to do at this phase? I humbly suggest:

1, Accumulate cash, or stablecoin, so that when the time comes, you have the gunpowder to make the shot. Park your stablecoin in trustworthy places. If a Defi stablecoin pool offers more than 20% APR or anything looks too good to be true, maybe it is.

2, Stay away from alt-coins (anything that is not BTC or ETH) unless you really understand its mechanism. Is it a layer 1 (EVM) or layer 2? Who is the team behind the scene? Are they in for the long run to build an ecosystem?

3. Start dollar cost average strategy when BTC drops below 61.8% retracement (golden ratio) at 28800. You can use a simple Excel or a robot.