Finding Bitcoin Bottom via EMA

[ImThour]

I am not sure if this is already discussed but I found out that 20 EMA crossing 100 EMA has marked Bitcoin Bottom in the past.

2014-15:


2018-19:


2021-22:



What do you think, is this correct even this cycle or we are about to see this fail for the first time? 

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[NeuroticFish]

What do you think, is this correct even this cycle or we are about to see this fail for the first time?  

Since one indicator alone can be misleading, since TA alone can be misleading, it would be no surprise at all to see it "fail for the first time", really.
I think that you are overly confident in TA and this may lead to mistakes.

[ImThour]

I think that you are overly confident in TA and this may lead to mistakes.

Never said bottom is in, just presenting different aspects in my posts.
I haven't bought anything personally as of now. So I don't see where I am overly confident with this idea. :")

[Wilhelm]

TA are indicators of a complex network of human emotions and situations.
TA is useless if you don't take the macro picture into account.

Having multiple indicators will help but you still need to take into account what's happening in the real world because that ultimately determines how much money can flow into or out of Bitcoin.

I think a 20 and 100 EMA is a way too short period to make any guesstimate. You need to cover the normal human cycle called "a year". And it is common knowledge that Bitcoin has a multiple year cycle.

[Tytanowy Janusz]

I am not sure if this is already discussed but I found out that 20 EMA crossing 100 EMA has marked Bitcoin Bottom in the past.

What do you think, is this correct even this cycle or we are about to see this fail for the first time?  

I think that small sample error is too big to even consider this as a valid indicator. So far number of successful repetitions equals 1 because in 2014-15 you have event N=0 based on which you could create indicator and in 2018-19, during N=1, it successfuly predicted bottom. Now we have N=2 and its not yet confirmed. So its not like we are talking about possible "fail for the first time" event, we are taking about succeeded for the second time.

Its like you play coin toss. During first game heads won. Based on that you predict that heads will always win. You throw again and heads won again. Based on that you create a thread, here on bitcointalk, asking as if heads will fail for the first time during your next throw. Of course its possible and going back to TA and EMA20 and EMA100, based only on outcome we cant even estimate probability (because unlike coin toss its not 50:50) and N=1 or N=2 is way too small sample to say anything.

People say -"ok, small sample error, but we had only 3/4 bull runs in crypto, there is no more data". Ok but we had hundreds of those in stocks/comedies/gold etc. and based on this dozens of TA books were created. There is no need to create new indicator only for bitcoin only because it succeeded once or twice.
"bad data is worse than no data at all"

[dragonvslinux]

I am not sure if this is already discussed but I found out that 20 EMA crossing 100 EMA has marked Bitcoin Bottom in the past.

What do you think, is this correct even this cycle or we are about to see this fail for the first time?  

This is very similar to the Pi Cycle top/bottom indicator, that is based on bearish MA/SMA/EMA cross-over, as well as distance between the low and Long SMA. As they say, twice can be coincidence, three times is a pattern. So it's still to early too say whether this is a pattern based on 2 confirmed scenarios and 1 potential, even if looks convincing. It's a bit like the 2020 halving. Just because price increased twice before, doesn't mean it will happen a third time. Even though that's exactly what happened.

PS - You forgot to put time-frame: Weekly.

I think a 20 and 100 EMA is a way too short period to make any guesstimate. You need to cover the normal human cycle called "a year". And it is common knowledge that Bitcoin has a multiple year cycle.

It's based on the Weekly chart, so the 100 EMA is close to 2 years. Otherwise you'd be right, as it'd have called a low at $47K  

[ImThour]

I think a 20 and 100 EMA is a way too short period to make any guesstimate. You need to cover the normal human cycle called "a year". And it is common knowledge that Bitcoin has a multiple year cycle.

I am aware of that. Using EMA/MA's only, I was able to call for $21k when Price was at $48k and no one was willing to bet short with me.
And as dragonvslinux mentioned, 100 EMA is 2 years average which is more than enough.

Not saying this is the exact bottom, I myself think we are yet to see a bottom but this indicator has worked perfectly in past.

And as 200 Weekly Moving Average failed to hold the price this cycle, this might also fail.

Only time knows.

[dragonvslinux]

Not saying this is the exact bottom, I myself think we are yet to see a bottom but this indicator has worked perfectly in past.

Oh, how dull. I had thought you were a bit more bullish than that. I'm currently at 60% believing the bottom is in, based on my own arbitrary data. Could still take months to confirm for me though.

And as 200 Weekly Moving Average failed to hold the price this cycle, this might also fail.

This is the biggest concern for me, as without reclaiming the 200 WMA, price won't be able to go (that much) higher in the near future. Therefore more likely to go lower if it doesn't. I'm however pretty confident it can be reclaimed this week, now that the RSI has left weekly oversold conditions. Miners still need to get their shit together though (no offence to anyone here).

Also.

TA is useless if you don't take the macro picture into account.

If more "bearish" CPI news arrives that causes a 10% pump in price, then I welcome it 

[ImThour]

Oh, how dull. I had thought you were a bit more bullish than that. I'm currently at 60% believing the bottom is in, based on my own arbitrary data. Could still take months to confirm for me though.

I know right, I saw your thread and I am sure, this time might be a bit different.
As mentioned above, 200 WMA which used to be long term support is now a resistance.
We are in an Inflation and it's scary around us with an economical war ongoing.
I really want to believe in the indicators but in the end, indicators are derived from price action.

It can always do something like this:

[NeuroticFish]

I think that you are overly confident in TA and this may lead to mistakes.

Never said bottom is in, just presenting different aspects in my posts.
I haven't bought anything personally as of now. So I don't see where I am overly confident with this idea. :")

I didn't say nor assumed that you said anything 
I was just giving out a friendly warning just in case. If you already know that, even better (but you also know that it's not only you who reads this).
Also, I said "overly confident in TA", not in a certain idea. Like Wilhem said it here in a nicer way, TA should not be taken into account all alone. That's all.

[adaseb]

By the way, that was not the bottom in 2015. The bottom happened sometimes in the summer when on Bitfinex there was a large stop hunt and it went to like $150-175 or so. I am too lazy to dig this up but I know this for a fact because I took a long somewhere in that area.

I have no idea why but there was some event and it caused a bunch of stops to get hit, broke the yearly low and quickly reversed after. Everybody was thinking that Bitcoin would go to double digits that day but all was well.

[ImThour]

By the way, that was not the bottom in 2015.

I don't think it hit anything below it ever.

[dragonvslinux]

By the way, that was not the bottom in 2015.

I don't think it hit anything below it ever.

Based on BLX (Bitcoin Index price) this is true, price never went below the January 2015 low.

The bottom happened sometimes in the summer when on Bitfinex there was a large stop hunt and it went to like $150-175 or so.

This is also true, on Bitfinex price went down to $162 when previous low was $166.5. Personally I think we ignore a single exchange's BTC price when it deviates from the norm. At least based on Index's average price weighted by volume, Bitcoin didn't make a new low. Otherwise we start considering Bitmex going to $0 and other nonsense.