I'm calling the current wave in the crypto bear market as "over" for now, This is why:

Based on what I've picked up in the charts today. I am calling Sunday's dip the bottom of the current wave.

It's largely pattern based, but the timing and current price movement of the coins does seem to tie in with it. Here is what I've seen.

THE BEAR IS OVER - At least for now

I was experimenting with the charts, trying to measure the change between the rates of the three major bearish waves this year. I was doing this by means of triangles, with the idea of overlaying them (typical Bit Brain and his overlays) and seeing how the angles of the three hypotenuses compared.

This is what I did:

Made by Bit Brain with TradingView

I was fairly happy with my initial findings, the triangles were getting visibly flatter with time, indicating a weakening of bearish sentiment during down-trends and signalling the return of a bull market in the not-too-distant future.

Then I noticed something else: the lengths of the bases of the first (red) and last (blue) triangles lined up. Exactly. This meant that they were the same duration. Having being made on a chart with 4 hour candles, it meant that even allowing for small errors, the two time periods (each 50 days long) differed from each other by no more than half a day. That's a 1% error (max), which I found almost too close to be a mere coincidence.

But coincidences do occur and one shouldn't read too much into them. This was after all only two data points, even if the similarity was remarkable. Perhaps I may have called the ATL of the last triangle too early, it may drop lower still. But then I noticed something else...

If I tweaked the middle (yellow) triangle just a bit, things changed. I had constructed all three triangles from ATH to ATL, which was logical to me. But by focussing less on the "Bit" side of my personality and more on the "Brain" side, I realised that all three triangles had not necessarily been constructed the same way:

The first and third triangles had also been constructed so that they ran from the start to the end of their entire bearish periods. The middle triangle had not...

So I redrew the middle triangle to be the same as the other two: start of bear period to end of bear period. This is what I got:

Made by Bit Brain with TradingView

Now that is the kind of overlay that makes all the other overlaying worthwhile! The base length of the centre triangle was also an exact match for the other two. I now had all three time periods lining up exactly, which is far more statistically significant!

In simple terms this means that all three major bearish periods of 2018 have been exactly the same in duration.

From a prediction point of view:

This gives us a very strong indicator of how long any further bearish periods (if any) in this cycle may be. More importantly, I believe that it confirms that the last triangle (blue) has reached the end of its bear market and that prices will now rise. (The big question of course is: "for how long?")

Of course these triangles can be constructed as Elliottt Waves. Because I distrust Elliott Wave predictions, I'm going to stick to my triangles (yes I know it amounts to the same thing, but geniuses are allowed to be eccentric, okay?).

In Elliott Wave terminology, this could be the start of the first impulse wave of the next motive wave, the end of the descending triangle and the start of the bull market - or in simple English - the market might have just finished with its bearish period for the foreseeable future.

This is the best case scenario, but I don't want to see the world through unrealistic rose-tinted spectacles and create unwarranted hype, so let me tell you the others.

It may also be the start of an Elliott corrective ABC pattern in a bearish market. Though this would mean a temporary price increase, it is uncertain what happens after the prices have increased at the end of the second impulse wave (point C). It could also be the final impulse of a descending triangle in a bear market, that would mean it could break even lower after a short upwards run and the market could continue to contract. That would be a worst case scenario.

Further considerations:

The length of the triangle bases may still just be a coincidence that means nothing. Prices could dip lower still. I consider this to be highly unlikely.

I have only used BTC in these charts, not the entire market. I don't believe that this matters, but it might.

Technical Analysis patterns are just patterns, there is no hard and fast rule that says the market must stick to them. They are also always easy to see in hindsight, but difficult to predict. My immediate belief for the future is that the market will not contract further, but will instead flatten before climbing properly. From the perspective of fundamental analysis and long-term trendline technical analysis, I still believe that the crypto market is due for an enormous climb soon.

For the record: I consider something like this to be realistic:

Made by Bit Brain with TradingView

At the moment I'm very happy that I bought BTC with fiat this past weekend (as I mentioned here) and that I then turned it into NEO (as mentioned in here).

Watch the markets closely, one way or another we are in for exciting times soon.

Yours in crypto,
Bit Brain

---

Published on

by Bit Brain

---