So, A sudden rally just started. These have soon died and turned lately, but anyway, I noticed that the order book balance had changed, from having been buyer-heavy by something like 5000 to 3000 bitcoins, maybe a sentiment and expectation from buyers that prices should fall before they rise, but now it is almost equal, like 2800 to 2700. Is this any kind of sign?

OK, here's my take on why we fall so hard now:

If you look at a one-day chart over the last year, you find that we had a nice pace of the tops, with corrections, being aproximately two months apart, and each top being ~150% of the last top, and the correction down to the last top (so about 33%).



I have marked the tops with arrows. There is a missing top in may, even though you can see traces of it.

The tops are (rounded, since that also happens psychologically in the priceing): $1,300, $2,000 (missing), $3,000, $5,000 (rounded up from $4,500), and $7,500.

Here's the big problem: the next top in this nice, stable rise should have been $7,500 * 1.5 which is $11,250, maybe rounded to $11,000 or $11,500, and it should have been reached around early january or maybe late december, with its correction reaching its bottom around mid january.

It didn't happen this way, as we know. A mania broke out, and we reached almost $20,000 in mid december. It was insane. It was almost double what it should have been, in the already fast, but seemingly stable pace we had, which was predictable and didn't make anybody nervous.

The interesting thing is that the $11,500 that we should have reached in early january WAS reached in mid january, in a drop from ABOVE instead of in a rise from below (marked with an arrow). And the correction that we SHOULD have had after this rise to ~$11,250, should have been to the previos top, which was at $7,500. And the really interesting thing is that that correction down to $7,500 is what we're in now, even though we overshot it a little... The next top should have been ~$17,000, which interestingly was a local top in early january.

Then, what happens now, after all the fears that are felt after that over-the-top top in mid december, and its reasonable correction (which to many seems unreasonable) to where we are now? Will we go to the next top of ~$17,000 as if nothing has happened, or will the over-the-top top be followed by an over-the-top (under-the-bottom?) bottom? Will all the confidence be gone for a long time?

I really wish that the mania in december never happened. It would have been nice to be on a steady path to the $17,000 top now, which probably would have been reached in early march. The next top after that would have been $25,500 , sometime in may.


EDIT:

I do think now that there will be an over-the-top bottom now after the over-the-top top. The question is how far. The natural thing is to look at the above mentioned levels. I guess that it will probably reach $5,000, and the question is if it will shoot up from there, or if it will fall to the next level of $3,000... I would think, and hope, that if it reaches $3000, it would be so low, that the in-the-know people would fight to buy there, so it quickly would shoot back to $5,000, and then continue up. But hopefully that will happen already on the $4,500-$5,000 level, up to $7,000-$7,500 and then continue up from there. What do you think?