Can Bitcoin End Crypto Winter?
In this episode of NewsBTC’s daily technical analysis videos, we use the Fisher Transform and other tools to see how close Bitcoin is to ending the crypto winter.
Check out the video below:
VIDEO: Bitcoin Price (BTCUSD): October 24, 2022 Crypto Winter
Bitcoin continues to be boring, but the topic of this video is about what happens when the notoriously volatile cryptocurrency gets boring. All cons and no collections make Bitcoin a dull boy.
“Here’s Johnny: “What happens when Bitcoin becomes a boring boy
Bollinger Bands are getting even tighter, showing that explosiveness is coming soon enough, and this ongoing pause is just the calm before the storm. The Daily Bollinger Band Width is now at its lowest point since October 2020 just before the bull broke out in 2020. Before that, the bands tightened just before the collapse to the bottom of the 2018 bear market.
On weekly time frames, the Bollinger Band Width is the tightest since the crash in November 2018, when Bitcoin fell another 50% to its final bottom. All cases before that when the bands got so tight led to a huge rally.
The monthly time frame shows a very unusual phenomenon. Bollinger Bands are actually widening now after being some of their tightest ever. Rising after such a break in volatility has previously always triggered a trend-rich bull run. Is the third time the charm?
The Bollinger Bands are some of the tightest ever | Source: BTCUSD on TradingView.com
Related Reading: Is the Last Wave in Ethereum Up Next? | ETHUSD Analysis October 19, 2022
Why we could have several weeks of crypto winter
After this weekend’s weekly close, Bitcoin bulls have now closed out three full weeks with a confirmed bullish crossover on the LMACD. Compared to the bottom of the 2018 bear market, we would only be a week or so away from making a major move up.
However, a comparison with the bottom of the bear market in 2015 shows that although new lows may not come, it may be twice as long to wait before the bottom is confirmed as in and the range remains.
Other possible signals on weekly timeframes that may indicate that we have already seen the bottom are Heiken Ashi candles turning green.
Cyclical timing tools suggest spring is almost here
The two-week Fisher Transform has also started to turn bullish (pictured right). But it will take another 14 days to confirm the signal. The Fisher Transform is used to find major turning points in markets, but works best on the highest time frames.
Moving to the monthly time frame (pictured left), we can see that even here Fisher has very little room left, and if Bitcoin is out here for another week or so, the month should start to flatten, signaling a possible turnaround in the price action. The Fisher Transform is based on a standard deviation formula, and with Bitcoin monthly at -3.0 standard deviations, there is only a limited 0.1% chance that the bear market will continue.
