As of the week of June 27th 2022. Using the MA Ribbon (Simple Moving Average) on the Weekly time-frame with intervals of 52 candles, starting with 52 (1 Year).
1 Year: $42,845
2 Year: $36,488
3 Year: $27,229
4 Year: $21,896
5 Year: $19,099
6 Year: $16,104
7 Year: $13,860
8 Year: $12,168
9 Year: $10,869
10 Year: $9,787
The reason I post this is as many are expecting $14K, $12K, even $10K, so I wanted to contextualise this within the Yearly MAs. Historically the lowest Yearly MA price has reached was the 5 Year in March 2020 @ $4.3K, though price reversed in between the 5 & 6 Year MAs at $3.9K based on Index price. Notably this year we have reached the same average yearly price in between the 5 & 6 Year MAs @ $17.5K.
This effectively means anyone dollar cost averaging (properly) since the beginning of 2017 since $1K prices, without taking any profits, would have already reached break-even by now.
Another way to look at this would be the following:
- If price reaches $16.1K this would mean DCA since 2016 would be at break-even (6 years)
- If prices reaches $13.8K this would mean DCA since 2015 would be at break-even (7 years)
- If price reaches $12.1K this would mean DCA fsince 2014 would be at break-even (8 years)
- If price reaches $10.8K this would mean DCA since 2013 would be at break-even (9 years)
- If price reaches $9.7K this would mean DCA since 2012 would be at break-even (10 years)
This isn't to knock DCA at all, quite the opposite. This is more to reflect upon the amount of people who claim they wish they had invested in Bitcoin much earlier, rather than the past few years. The irony being that if price were to reach $16K, this would be the equivalent of 6 years of DCA, $14K nearly 7 years worth and $12K would be 8 years worth of DCA. $10K would be an entire decade's worth of DCA.
While I can see the reason for further capitulation down to these levels, as below $16K for 6 year long DCA investors who never took any profits, they would be sitting in a loss for the first time in many years. But subsequently, for others who wished they had dollar cost averaged into Bitcoin since 2014/2015, they would be presented the exact same price average if capitulation reached $12K to $14K.
To elaborate though, I think most who DCA'd from the past 6 years took some profits along the way, even if it was to re-invest at lower prices. I find it hard to believe the majority would of never sold any BTC. The minority who never sold any satoshis probably won't feel so inclined to do so after hodling for so many years, if they are still stacking sats that is, even if this is just theoretical.
Finally, if price does reach $10K, I genuinely do think there could be a decade long bear market, even multi-decade long, similar to Gold in the 80s. Not that this has to happen, but I see the strong possibility of it. As has nearly always been the case if a decade long bull market turns long-term bearish. But at the same time the 10 Year MA (or the 8 or 9) level could easily act as a bottom price before years worth of consolidation.
By comparison, looking at the Gold chart using Monthly MA Ribbon (SMA) with intervals of 12 (1 Year) starting with 12 (after it's decade long bull market and 25x increase):
- In 1976 price bottomed out at the 8 Year MA, followed by 2 years of consolidation before making a new ATH, increasing by 700% from the lows
- In 1982 price formed a bottom at the 9 Year MA, followed by two decades worth of consolidation before starting a new uptrend increasing by 500% from these lows
- In 1982 The 10 Year MA was around $285, which was the $4 higher than the low in 1985, even though in 1999 during the dotcom bubble price did make a new low of $250.
This isn't intended to compare Gold to Bitcoin today, of really their prices in the past, as I think they are too dissimilar. But arguably comparing the de-pegging of the dollar to Gold in the 70s and the rally that occurred that decade to the creation of a mathematically regulated monetary policy such as Bitcoin a decade ago, could be something to consider here. That of "what happens after the bull market".
Personally I prefer the comparison of "how speculative markets generally move", and that if a decade-long bull market were to come to an end, it doesn't mean price will drop to $1K or $100, but simply that it could take many years for price to recover, and that $10K to $14K is a realistic low even if that were to happen. Again, not that this would happen, but only if this does happen. So far, that is yet to be seen, but for those who still believe in the long-term perspective of Bitcoin, it might require shifting perspective to a multi-decade time-frame, as opposed to single decade. Just my two satoshis on the matter.