Macro Movement: What if everyone is wrong?

LeoFinance
1 month ago
7 Min Read
1354 Words

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When everyone tends to believe the market will do a certain thing, it almost never actually does the thing. We've seen this play out time and time again over the years. I can still remember back in 2018 when everyone on Steem was calling $2 the ultimate bottom and that the price would be $20 in no time. This led me to believe that I would never even a dolphin (let alone orca) within this community. One multi-year crypto-winter later and here I am with multiple orca stacks at my disposal.

It was also around this time that everyone was saying that Ethereum was pointless and ERC-20 tokens were going to make it completely irrelevant. Man, what a ridiculous thing to claim, especially in retrospect. Of course I was calling out that BS the second people started saying it.

I will admit that I thought ICOs were going to have much more success than they actually did. I lost a lot of money in 2018, and I'm sure many of my readers did as well. We all still have a lot of lingering PTSD from all the coals we've been raked over time and time again.

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We've seen ETH pull more than an x40 since that time: quite an impressive feat. Unfortunately now transaction fees are absolutely ridiculous, but I guess that's the price you pay. Funny because fees haven't really gone up at all in terms of ETH, but now that the USD valuation of ETH is sky high everyone is losing their mind.

But this is off topic.

The real topic here is speculative: where is the ball going? What will the price be in the future? Wen Moon? Of course no one actually knows the answer, but it's fun to try.

Many users (especially myself) have been subscribing to this idea of 4-year mega-bubble cycles followed by a year of bear market. We've been fully on track for this reality until just recently. My price target was $65k in October, and we hit it. My price target for November was $100k, and the market is lagging hard. At this point it looks like PlanB might be correct in thinking that the peak for the end of the year is gonna be around $135k. This is not a mega-bubble, but it is half way there, which would be very concerning imo.

Another theory is the trend of 18 months between bull markets. There were 18 months between the bull run of Q4 2017 and Summer 2019, then again from Summer 2019 to Q4 2020. This would put the next peak at Summer 2022. However, with such little data (2 points) it's hard to connect the dots and ensure the pattern will play out again. Ironically if the market "knew" the pattern would play out, as said earlier, it probably wouldn't.

But what about that third option?

This is one that nobody talks about because nobody wants it to happen. What if the market just trades sideways for an entire year? What if we just have another 12 months of sideways boring action between $50k and $70k and everyone is just left wondering when the next bull run will be? This very may well happen, especially considering the market is absolutely not prepared for such an outcome. It would really throw a wrench in everyone's plans for the future.


2020202120222023202420252026
$12.8k$25.6k$51.2k$102.4k$204.8k$409.6k$819.2k

Looking at the doubling curve for Bitcoin, we see that the current baseline value is only around $25k at the moment. In a year it will be around $50k. If we just trade sideways for a year the doubling curve will catch up to the market organically and there will never be a bear market. While this might be "boring" it would also be the best thing to happen. Stability within the cryptosphere creates more growth than volatility. In fact, volatility can often be interpreted as a money attack on the network, especially if that money is coming from a very small number of sources.

Do I think this will happen?

Not really. It's hard to imagine stability for 12 months with everything going on right now. On chain analysis is off the charts. Supply shock is still in full effect. Developments are being made across hundreds of chains. The FOMO will strike sooner or later.

But what if they don't FOMO?

If we assume that institutional investors are leading the charge in this current run, then it would make perfect sense that they would play it safe and not pump Bitcoin too high. Institutional investors are the ultimate diamond hands. They know what they are doing. They aren't ignorant and emotional like retail investors. They aren't going to collectively put themselves into an insanely risky situation due to shear delusion like retail has done multiple times now. They have superiors to answer to, and hedge funds to protect, and a career path to secure. Chance of Mega-bubble FOMO is much lower this time around and no one seems to be addressing this obvious elephant in the room. Everyone just wants number to go up without thinking about the mechanics that require this to happen.

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Classic retail:

Wanting the market to pump irrationally and foolishly when they already know for a fact that this isn't how the sharks operate. Clearly, they have very steady hands and are more than willing to slowly dip their toes rather than jumping into these risk-on assets face first. Not everyone is Michael Saylor. In fact, we will likely never see another shark like Michael Saylor ever again. That guy stands alone, leveraging junk bonds to buy more BTC and borrowing billions in debt; what a madman!

Perhaps institutions getting involved is a great blessing in disguise. How else was Bitcoin going to gain stability? Only with massively liquidity providers with steady hands ready to buy when users want to exit and sell when users want to FOMO in. They very well could create the infrastructure at both ends of these liquidity pools to capture maximum value while providing their desperately needed service. I knew those sharks were good for something.

Of course none of this logic applies to an oversold decentralized network like Hive. Bitcoin trading sideways for a year would be the best thing ever for Hive. The more bored and restless Bitcoin bulls get the easier it will be for the micro-caps to pick up adoption. Considering all the progress we've made in the last few years I think it's fairly obvious that getting back into the top 30 shouldn't be as difficult as it sounds at face value. I honestly expect another x10 for Hive within the next 12 months, but then again I'm pretty biased so take that with a big grain of salt.

If you've played poker before perhaps you've experienced the boredom of stagnation. Players can go on tilt when nothing is happening, and they would rather lose than just sit there and do nothing. You keep getting dealt garbage hands over and over again so you keep folding over and over again, and the game becomes unbearable. Many people are there to have fun, so they play a garbage hand because even though they'll lose money on average there's still a chance they can win and they are bored out of their mind so why not. Pay to play.

It's really only a matter of time before this kind of boredom hits the crypto markets. Users will get bored with BTC if it stops performing and they will end up trading on x10 leverage or moving into more volatile alt-coins. Be on the lookout for this kind of behavior, and try to avoid doing it yourself. Emotional gambling never ends well.

Conclusion

Bulls demand that the price goes up.
Bears demand that the price goes down.
Legit no one is saying it will trade sideways.
Perhaps that's exactly why it will.

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