It’s early August, which means we’re smack middle inside my least favorite season. In fact there’s only one season I absolutely despise and that’s SUMMER! And with good reason…
You may remember that big fruit tree in front of our house that tried to assassinate me a week or so ago? Well, its evil plan failed and now, just out of spite, it’s started to dump thousands of small fruit all over the floor:
Frankly, I have no friggin’ idea what those things are. Someone in the region suggested they may be some type ‘cherry peach’ and admittedly they do taste just like tiny peaches. Definitely eatable.
“But Mike, you cantankerous old grump” I hear you say, “… so what the heck are you complaining about? Nature has blessed you with buckets of delicious fruit for absolutely free!”
Oh well, I’m not complaining about THAT. In fact my intrepid wife and I spent our last two weekends cooking up a lifetime supply of jam and apple sauce from various fruit trees on our property.
But there is a downside.
See those buckets wrapped in industrial size fly paper? Those started out completely white yesterday evening and a few hours later they were completely covered with flies. Yuk….
I hate flies. And they are everywhere now. We’ve probably already disposed of hundreds of thousand over the past week but those little bastards are reproducing faster than we can genocide them.
Basically we are swapping out the tape every single day, it’s hard to keep up.
Now, don’t get me wrong, I love this place – it’s heaven. Except in the summer when it gets hot, everything ripens and there are insects everywhere.
We’ve got a ton of thrushes (small ground feeding birds) in the area but even those can’t keep up in face of so much fruit and the millions of insects picking at them.
I saw a chubby blackbird yesterday trying to take off but it had gotten so big that it tumbled and nose dived back into the ground. Okay I made that one up, but come on – the thought is hilarious.
Yes, napalm is an option, but I sort of like my garden the way it is, so maybe I’ll hold off. For now!
In all seriousness though, I’m learning a LOT about growing fruit. One big take away: the real problem aren’t the insects, it’s the birds.
Don’t get me wrong – I love birds, but those are the ones picking on all the fruit, which then allows the flies to get inside. Completely ruins the harvest.
Next year I’ll probably wrap all our fruit trees with netting, which should not only increase our yield but also cut down on all the insects.
Alright enough with my Mediterranean redneck problems – let’s talk bzns. The term ‘summer lull’ exists for a reason which is why my posting schedule has slipped a bit over the past week.
However those periods are ideal for taking a step back and getting a sense of the overall picture.
It’s easy to get side tracked by the daily [engineered] noise and drama, which makes it ever more important for us traders to remain in sync with the overall trend.
To that end let’s play a little game today. I promise it will be quick and fun.
Take a look at the chart above. It’s a daily of BTC/USD but what I’m sharing with you today applies to every single chart you’ll ever lay your eyes on,
Now draw some straight lines along the main trend lines you can identify. You’ll quickly discover that it’s not too difficult and usually there’s a pretty obvious vector price is following.
Except of course when it changes, and usually you can pick out those inflection points, which flag sudden vector shifts. Usually it’s one or two large candles that breach a prior spike high or spike low.
I’ve pointed out a few of those via those blue errors.
You’d think this is a pretty trivial approach to plotting a trend. Which it is and why it’s a bit surprising that most people completely ignore it.
What’s cool is that this approach to plotting trend direction happens to be fractal, which is fancy quant speak for it applying to all time intervals.
Case in point is the weekly chart above. I’ve done the same thing there and I’d say the take away is pretty clear: The overall trend usually stares us all in the face, and so do the moments when it changes.
Finally here’s a monthly chart. This time I’ve employed what’s called a ‘zig zag’ indicator, which you’ll find on any modern trading platform.
The settings define how quickly the indicator responds to directional changes, I think the 5,4 setting (on TradingView) is pretty ideal but hey, pick your poison.
What’s the take away for Bitcoin given this approach? Long term we’re clearly back in an uptrend after a topping formation followed by a one year bear market.
Medium term we’re in a sideways summer churn, I already stated previously that it won’t resolve itself until the end of summer. Probably by the time I’ve finally gotten rid of those damn flies.
Bottom Line: If you’re a crypto investor or are thinking about jumping back into the fray then mainly the long term picture should be of interest to you. Everything else is noise.
Right now the LT trend remains to the upside and we would need to see a pretty significant downside correction < $20k for that to change.
Possible but is it likely in the face of increasing institutional interest?
Anything can happen of course but I for one long decided in favor of a long term future for Bitcoin and other major crypto assets (ETH in particular). I did not change my outlook in 2014, in 2017, or during the 2022 crypto winter.
Which is why I built a long term trend trading signal that is impervious to market cycles and continues to keep me on the right side of the tape.
Remember, the whole idea behind trading the greater trend isn’t to pick tops or bottoms. It’s about remaining on the right side of the tape when it matters the most.
And that’s what Gravitas is really good at. Plus it’s a long term signal, at the very most you take action once per month on average. Perfect for the busy operator.
Besides, the results speak for themselves, so if you’re interested shoot us a message today and we’ll get you set up just in time before the next leg higher.