Analysis News

Bitcoin (BTC): the factor of five days and robots

Over the last month, Bitcoin (BTC) regularly falls by 5-10% with an interval of 5 days and rises again. What does it mean?

FOMO as a market driver

Thomas Lee, Fundstrat Global’s co-founder, once again pleased the community with an optimistic Bitcoin forecast. This time, he predicts a 200-400% takeoff of the Corn. A good spread of the forecast – 2 times! But in the world of crypto, we are used to it. Thomas Lee confirms his prediction mathematically, more precisely, statistically. Commenting on Bitcoin’s strange behavior over the past month, the expert claims that it does not do without institutionalists and their well-known Fear of missing out (FOMO).

Thomas Lee calculated that this fear occurs when the price reaches the level at which it is held 3% of the time. In past cycles, this level was the price of $ 8500. Now it is $ 10K. It is at this level that bitcoin has only been trading for 87 days.

– FOMO really occurs when the price achieves a level that’s only happened 3% of the time. So in past cycles, that level was $8.50 in 2011. Today that number is $10,000 because Bitcoin’s prior to today has only traded above $10,000 for 87 days.

Here is a math. Further – more interesting. As soon as Bitcoin reaches, at least at the moment, prices of $ 10K, the FOMO will work, and the institutionalists will start to purchase massively. And this means that the price will quickly grow by 200-400%, that is, up to $ 40K (optimistic). It could be brushed aside if some crypto-blogger shared such revelations. But Thomas Lee has a good steady reputation and wide experience. In particular, his Wall Street assessment looks convincing. The expert claims:

– Wall Street – if there’s a known asset class and they believe they can have an edge – they’re going to be quite interested in investing in it. Because Wall Street has the ability to marshall a lot of resources to develop either a fundamental edge or trading expertise and make money.

According to Thomas Lee, Wall Street financiers are well aware that 80% of stocks, which fall by 90%, never restore. Bitcoin fell 85% from $ 20 K and has recovered by 40%. This is a clear signal that reports of Bitcoin death are greatly exaggerated. Therefore, the institutionalists are preparing to invest in it.

Summarizing: Robo trading and Crypto

It is known that financial experts never speak openly and for free the whole truth. Otherwise, how would they earn! The publication of Fundstrat Global calms the market, but does not explain how these five percent fluctuations occur. Hardly Thomas Lee does not know this: this inhuman behavior has only one explanation – inhuman trading. That is, stock robots work in crypto. This is the only explanation for the current precarious balance. And if it is true, then the balance can last long enough – after all, robots have iron nerves. Thomas Lee himself estimates the FOMO will occur within five months.

The fact of trading robots work on crypto market confirms the wide participation of institutionalists. Is it good or bad? They have a lot of money, so the market is getting bigger and more stable. But they are prone to manipulation for super profits. And this is a big trouble for the market.

Advertisements

One comment