Bitcoin Forum

There is a rule in technical analysis called (50%).And it is called pullback.

Whenever the price reaches a peak, it can go down to 50% before the pump.
The same thing will happen again in falls.

In the morning, the price dropped from 11,500 to 11,200.
And after this fall, it rose to about 11,350.
Of course, we have a drop of up to 30%, but 50% is more common.

http://s16.picofile.com/file/8411070576/1.png
image Source:https://www.tradingview.com/symbols/BTCUSD/

And I also think there is strong resistance in 10950 and those who have bought below this price should not worry.

Also do not trust my analysis !!
Why? ???  >:(
Well, here is your answer:

First Trump took the corona, the next two cases were about money laundering and the federal court ruled against them, so my question is which one of your analysts predicted these cases?
Also, who predicted the arrival of Corona?
So go ahead with your own intellect and logic and enjoy the market to the fullest. ;)

I think you have made 2 topics in one fold.
1. You made post on technical analysis and
2. You posted on covid-19 and Trump.
Maybe you should have focused on one per topic.

Anyway, I will talk on technical analysis. The pull back is that time in the market when price got to its pick, it could be on high or on low and it has to do a correction or retracement.

This kind of situation can also be a profit time or losing time, meaning it is a time to be careful.

It can be used for learn how the waves strategy works.

It can change direction of the market if noticed in a longtime hour.

Bitcoin movement is 100% unpredictable but occasional rules should be made but it will not apply to each and everyone in my opinion and If you think over it 50% is irrelevant in my opinion the relevant for me is 50/50 because the movement of Bitcoin and other cryptocurrency is unpredictable there is a 50/50 chance what you think about it will not gonna happen, but the certain technical analysis also have a 50/50 chance that it would settle or not settle,

I also strongly think that there is indeed strong resistance with the $10,000 USD as well and this is just what I think the price is still striving to go even further and I have a trade on the $11,510.20 USD right now well I am being safe when it comes with trading and I think it may penetrate that mark.

I am not a financial adviser only making trades with my eyes close.  :P

Bircoin went to $1200 and then dropped to $180.
Bitcoin went to $20k and then dropped to $3300.

Those both were about 85% drops in price. That is what Bitcoin does. If next ATH will be $150k it will drop back to $25k.

At least you are honest with your analysis. There were analyses in the past and they encourage people to believe what they say that this will happen, and that will happen. In your case, you're giving the people an option not to believe with what you are saying. As a normal person whom seeks also advises and analyses from other people, I wouldn't believe that quickly with everything that I've read. They're all speculations and the perfect attitude of bitcoin is always the most unpredictable thing in the market.

^ If there is new ATH, it could possible if there is a correction of the price right after the surging in the market. But if you will look back the previous chart of bitcoin price, it will always end up surging the price in the market. However, all these predictions has no support or even technical analysis is quite outdated, also. Nevertheless, there si no accurate time and it is always unpredictable, so why others worried the price.

Or even more, the recent downturn due to the corona virus last March was a dramatic fall of almost 60% if I'm not mistaken.

The drop was due to the OKeX news, but the thing is, the market must have heard worst news that before. And as others have said, when we are in a bullrun, regardless if the news is negative, the market will bounce back, and I think this is what happened today.

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I'm not going to comment on the Trump "issue" though, it's better to wait after the election and see what will be the effect on the market, short term.

That sort of crash (85%) is typical only after a bubble characterized by parabolic, exponential gains. In 2017, BTC did a 20x before crashing to the $3,000s. That's why it crashed so hard.

A more generic rally (the type we see everyday in markets) is more prone to pullbacks like the OP is talking about. The 50% retracement level, and also the Fibonacci levels of 38.2% and 61.8%, are very common.

OKeX is nothing to do with this topic at first and reasons of the drops.
This small drop is not so important this time. For what I observed, $10, 000 is the significant support we should monitor, it's already ages since we don't close on daily timeframe below $10,000.

And I don't really understand what OP said, if the $11,500 drop to $11, 200. It's not 30% or 50% drop.

Obviously if an asset is in a bubble then a huge >50% drop doesn't really mean anything. Look at what happened with AMZN and MSFT durin the dot com bubble. AMZN hit like $100 and then a year later or so it traded at $5, so its a 95% drop and it still exists today. MSFT hit a $60 and then later had a low of $20, so a 66% loss. And these are huge well known blue chip stock companies.

So just because something loses 85% of its value after it went 20x, doesn't mean its a bad asset. Honestly with what is going on now with most stocks like Apple, Tesla, Zoom, I wouldn't be surprised if another 50% drop came in these stocks.

Most stocks are overvalued by about 10 years of P/E ratios. But people are buying them like crazy so they keep going up and up. Obviously the bubble will burst one day.

We can say about many predictions that will happen with bitcoin, but the truth is we don't know for sure because bitcoin moves are unpredictable.
Maybe we can predict so close to bitcoin price moves, but it is hard to accurately predict the bitcoin movements.
But if we can stay calm when the price starts to rally, we will have the right time to sell bitcoin at a high price, although the price still increases.
If we can take the profit while we can, we don't have to worried if we miss the chance to sell at the high price because we always have the opportunity to sell at the right time.
I am sure many of us prepare for the downtrend after the price increase to get a lower price.
Hopefully, the next week, the situations will be changed to see another high price and it will continue to increase.

i'm not sure what you mean by this. 50% of the value that was just gained or lose 50% of the price. because the later suggests dropping down to $5000 and it makes no sense!
in any case there is no "rule" defining how much the price should drop after a rise. only the momentum defines it. there are numerous cases where price rise has a very good momentum and corrections are small (eg. 5%).

things like this have small and short term effects. that is why we have not seen any major price changes over the past weeks despite all kinds of similar news. the real long term effect however is them printing money nonstop which is going to boost bitcoin price so that we end up seeing at least twice the size of previous bull run.

I'm not what you are thinking about the 50% rule, does it really exist? Maybe it is just you that have to see it because I don't see it honestly.
We can't deny about pump and dump scenario. We reach $10k and applying such a 50% rule might have to expect to reach it back at $5k if it dumps, but I don't see it happens. I may think that it was not a 50% rule, and just what @pooya87 said, it goona be 5%.

Anyway, it was your own analysis, we differently look at the market flows and therefore, we think differently as well. But the truth is that the market remains unpredictable, there is no 5% rule nor to have 50% that is the reality.

But given the inconsistencies, I think it is enough to tell that things will not happen as expected. We have seen instances wherein expectations are not met by the reality in this industry. Things could always go the ither way around when it comes to the market price simply because it is in nature of the market value of cryptos to be volatile, thus, patterns won't work. Things occur without a warning. If its market value will be able to reach its ATH again or even acquire a higher market value, what will happen next is a two sided situation. Its price can go higher, or fall in a sudden BUT without certainty of its "stopping point". What I am pointing out is that, strategies do not work in such way as it is meant to be, in this market.

That rarely happens in crypto because crypto is not like that, it is built differently, we are totally a different breed of economics and nothing even comes close to resembling what the crypto market is like. So, what we have in our hands right now is a tactic that would work for people who deal with forex or stocks or any other traditional market which is actually a true thing and could be used but a market that is not traditional and definitely very high tech new market people would be fooled if they try to make the same type of movements on crypto market as the markets who are traditional. This is why I would say sure use all these type of models and check it out, but do not think that every time bitcoin moves it would be like these, it could be totally different so be careful.

I am referring that trading is easy well you know what I mean, you will just pick a close price that the price might land on but in the analysis point of view checking the previous movements always helps and determining the news updates in the world can also help, but many times I just pick randomly by just checking the pattern,

Well the unpredictable price of Bitcoin makes it unique to fiat trading, and traders really dig the volatileness of cryptocurrency because sometimes unexpected really happens.

Exactly, and this is another reason why BTC is treated like a high growth risk asset like tech stocks. High risk, high reward. The potential upside is ridiculously huge. But going to $0 (or damn close) is possible too.

Amazon during the dot com bubble reminds me of Bitcoin's 2011 bubble. Similar downside. Similar long term potential (in terms of pervasiveness and relevant market share) if you think about it.


Money printing and fiscal stimulus measures certainly complicate things. The bubble should have popped a long time ago. Who knows when it'll finally happen.

I dropped OKeX because for sure you have heard what happened to them recently? and the timing of the drop from $11,500-$11,200 coincides with that news that's why it is a good example to point out as this is a recent event. And that is what the OP is talking, read his post,

In the morning, the price dropped from 11,500 to 11,200.
And after this fall, it rose to about 11,350.

You will not understand it if you haven't heard the news, and the OP is pointing that out as one example, yes it's not 30% or 50% drop, but he is giving us hypothetical reasons as to what may have cause the recent drop and maybe it could really affect the market negatively, hopefully it didn't as it bounce back to $11,300.

This sounds alot like Fibonacci levels except 50% is used but not officially part of that system of measuring retracements.   Its quite a reasonable way to measure strength in a rapid way, very often used by short term or day traders.

Both of those highs I consider in a kind of error condition, Mt Gox was fractional reserve undeclared and 20k revolved around a freeze up of the blockchain where transactions would never clear properly without a ransom to excessive fees.   I hope neither happen again as it could easily lead to a negative take if repeated rather then corrected and avoided.   The prices around here, last summer and now are what I consider the real volume to work through.

Your analysis is good but of course there is no guaranty in a highly volatile market, I commend you for posting a disclaimer you are right nobody can predict the future accurately, who would have thought the coming of Corona Virus, investors like us can only predict  what happen in the world economy but not a pandemic that creates confusion in the business and economic sector.

The 50% is part of the Fibonacci retracements. The most common fib retracements are 0.382, 0.500, 0.618. However I can't remember the last time I used a Fib retracement to trade. I think I used in a few times on the daily or weekly charts and maybe in the stock market but rarely is it to be used on the hourly charts. Not good for day trading at all.

I think the indicator works as long as it seems like a common area where to take a long or short. However it usually works best if its near a regular horizontal support/resistance line. Basically cannot trade alone on Fibonacci retracements, maybe use it for confirmation and nothing else. I back tested so many forex, stocks in the past and its not a trade TA to be honest.

There's none at all, there's no clear directions  as volatile market exist. You need to keep doing your research and follow the patterns that you understand the most. Investors and traders always seeking for a good path to take their money, each news which impacting to entire industry needs to sort out and deal with heavy research to avoid making mistakes.

First, the rules is 50% or pullback which was the language used in the technical analysis is to stop loss but crypto is always expected to experience pullback anytime even if the corona virus issue doesn't occur.
Second, every market analysis is a prediction and cant be totaly rely on and I dont see any reason to trade base on someone else experience in trade not talk about totally trust in a newbie analysis.

Im much aware with that 50% pullback on technicals which its been pretty common to make up some re-entry into these points but basing of into my experience with crypto then its just on 50-50 hit or miss situation.
but if you do have some sort of good decision making skills on the right time then you would really ending up on this kind of strategy. About fundamentals or news then i dont really much care on it because
in crypto, these news arent neither relevant or not on price movements.It can even move unexpectedly without any news happening around.So its a matter of decision neither you do utilize
these things or not because for a unpredictable market its really always pain in the ass on minding off on what would be the next price on next minute.

Yeah, I don't trust your analysis the same thing that I did to others, only I trust my instinct.

Nobody expect for corona virus(maybe) but some says it was already been planned before that I also pressume that some businessman or a few of them are already preparing for this.

Does the market suffer a huge drop during the pandemic? No, it's not because someone had already foresaw this to happen. I truly enjoy the market, everything is fine, and that 50% rule (as you'vesaid) is something that we never have to experience despite of the current situation.

That pullback is not always happening but its your technique and I guess it is working on you. This pullback you are talking in 50% is also a good idea where we can set stop loss on that pull back. However, we can confirm this in other technical analysis too. It's because there are times there are no pullbacks and went down or up profusely.

Technically the 50% level is not a Fibonacci level. It just naturally fits perfectly between 38.2% and 61.8%.

Fib retracements are vital to Elliott Wave analysis, so I always chart relevant Fib levels and I find them extremely helpful. I am not purely an EW trader though. I incorporate lots of other methods like horizontal S/R, moving averages, Bollinger bands, etc. which I think is key to my success.


Exactly. When you can find support and resistance levels where there is confluence among different methods, it's usually pretty powerful. When key Fib levels line up perfectly with horizontal S/R, it's usually a huge trading opportunity not to be missed.

That's really the ideal way to use any TA method, in combination with others.

Actually these 50% levels are nothing but a mean of the two Fibonacci levels which itself is actually formulated by applying a Standard Deviation on 50%. Without going deep into the topic. Simply saying that generally market respects the Fibonacci levels because they are mathematically derived values which exist universally. Even though they aren't 100% accurate but if you inculcate this pullback strategy properly in your studies you can usie it nicely. But yes another major issue generally traders face is the point from where you create this 50% pullback some generally take it from highest point of the previous trend while some take it from the most volumnous area of trade. So this is a pretty subjective point.