Issue 96 – Charting Bitcoin’s Next Five Years

October 20, 2021


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It’s a massive day for Bitcoin, with the market breaking to new all-time highs above $65,000.

So, where is this bull market going?

Better still, how might the next bear market and bull market after that play out?

We’ll be discussing all of that in today’s newsletter. Plus, updates on ETH, ADA, DOT, UNI, and VET.

Let’s get it!


Bitcoin to New All-Time Highs Today, Now What?

Bitcoin is breaking to new all-time highs above $65,000 today. It’s a monumental moment for everyone involved in crypto.

But instead of talking about where I think this market is going this cycle, which I’ve done already, I thought I’d talk about the next five years.

A look at the 2.272 and 2.414 Fibonacci extensions from the last two cycles shows a target area that was reached both times.

If we apply that same area to the current rant, we get an end-of-cycle target for Bitcoin between $207,000 and $270,000.

BTCUSD (monthly time frame)

We can also pay attention to the monthly RSI to time our exit from the current bull run.

Notice how BTC tends to end cycles when the monthly RSI reaches above 90. It’s also exhibited a double top pattern each cycle, which leads me to believe it happens again.

I’ll use this monthly RSI combined with net unrealized profit/loss (NUPL) to help time my exit over the next few months. I’ll be sure to talk about NUPL in future newsletters.

Now let’s look at what the next bear market could look like if we get a BTCUSDT price between $207,000 and $270,000 this cycle.

We know that the last three bear markets have produced corrections of 94%, 87%, and 84% respectively.

BTCUSD (monthly time frame)

Notice how each bear market has been less drastic than the last.

This is exactly what we’d expect from a maturing market. As I’ve said many times, a maturing market like Bitcoin is likely to see diminishing returns and bear market corrections.

As such, I’d expect the next bear market to pullback between 75% and 80% from the peak.

If we assume Bitcoin reaches $200,000+ this cycle and pulls back between 75% and 80% during the next bear market, it would put the next cycle low somewhere around $50,000.

And that makes perfect sense!

$50,000 is a psychology number, and it’s very near the $65,000 high that lasted for six months recently.

Using the same Fibonacci extensions as before and measuring from just above $200,000 to a low of $50,000, we get a cycle high in 2024 around the $1.3 million mark.

While that may sound unrealistic, it’s actually less than half of the gains from this bull market, assuming Bitcoin reaches $200,000+.

In summary, if BTC makes it to $207,000 – $270,000 this cycle, then I’m anticipating a bear market bottom between $50,000 and $60,000, followed by another bull market in 2024/2025 toward $1 million plus.

Bitcoin (BTCUSDT)

Today is a massive day for Bitcoin. The market is breaking out to new all-time highs above $65,000, which held as the previous all-time high for six months.

A daily close above $65,000 would confirm the breakout. At which point, BTC is in price discovery, meaning that $70,000, $80,000, etc. are all on the table.

As I mentioned in today’s video, I think a cycle peak between $207,000 and $270,000 is likely.

Of course, I’ll utilize monthly RSI, NUPL, and other means to fine-tune my target when the time comes.

It goes without saying that $64,800 is now support for Bitcoin.

BTCUSDT (daily time frame)

Ethereum (ETHUSDT)

ETH is also breaking out today above the $4,000 region. I’ve discussed the resistance area between $3,900 – $4,000 at length for the last few weeks.

A daily close above $4,000 flips that area to support. It also opens up Ethereum’s all-time high at $4,372, with a close above that triggering price discovery for ETH.

If Bitcoin can reach above $200,000 this cycle, then I think an ETHUSDT price between $15,000 and $20,000 seems likely.

Even at ETHBTC current levels, a $200,000 BTC would put ETH at $12,000, and the odds are high that ETHBTC rallies before the bull market ends.

ETHUSDT (daily time frame)

Cardano (ADAUSDT)

ADA has been a slow mover lately. However, that’s to be expected considering Cardano enjoyed a big run-up back in August.

In the short-term, ADA is catching a bid just above $2. But buyers need to punch through $2.35 on a daily closing basis to expose the $2.70 region, followed by $3.

ADAUSDT (daily time frame)

Polkadot (DOTUSDT)

DOT has been a great market to trade lately. Back on October 12th, I told Cryptocademy members that placing bids above $24 wasn’t a bad idea.

The very next day DOTUSDT rallied over 25%.

Yesterday, I mentioned that I was bullish while DOT was above $39. I also stated that the market looked bullish the way it was holding up after its gains on the 12th.

Today, the market is back in rally mode toward $48, which is my target.

If DOTUSDT can close above $45, that area should flip to support for a run at the all-time highs near $48. Above that would be price discovery for DOT.

DOTUSDT (daily time frame)

Uniswap (UNIUSDT)

I love the look of the UNIUSDT chart. I mentioned it to Cryptocademy members a week ago, but buyers failed to clear the $27 resistance area on a daily closing basis.

That’s going to be key moving forward. A daily close above $27 exposes $31.50. Beyond that is $36 and $44.

It’s important to note that $36 is very close to the measured objective of the inverse head and shoulders that has formed recently.

But again, UNI needs to get above $27 on a daily closing basis to confirm the breakout.

UNIUSDT (daily time frame)

VeChain (VETUSDT)

VET looks ready to break higher any day now. It’s been flirting with the $0.123 resistance level for weeks now.

But that’s okay because as I’ve stated several times on Twitter, the longer VETUSDT coils, the bigger the breakout is likely to be. And as of today, this consolidation has lasted 187 days!

A daily close above $0.123 opens up the year-to-date trend line near $0.13, followed by $0.155.

If Bitcoin extend toward $200,000 this cycle, I fully expect VETUSDT to reach that coveted $1 mark, maybe higher.

VETUSDT (daily time frame)

Justin Bennett

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About the Author

I'm Justin Bennett, a currency trader turned crypto enthusiast. My journey started with stocks in 2002. After limited success, I transitioned to currencies in 2007, which later became a full time trading gig. The journey continued, and in 2020, I committed to learning about cryptocurrencies. It was love at first sight. Cryptocademy.com is the culmination of my love for cryptocurrencies, my passion for financial markets, and desire to learn and teach.

  1. Justin if Bitcoin drops to 50k after this cycle, do you believe that vet will have the same 80%. Drop from its peak. I want to be able to set my buy orders properly. Mahalo

  2. Hi Justin,

    I sent to you more than 10 questions, NO REPLY RECEIVED.
    What is going ON with you.

    Brgds
    Miljenko

  3. Thanks for the analysis on Bitcoin long term Justin! Gives me a lot to think about on the type of play I want to do when the time comes. Very educational.

  4. Hi Justin – great analysis! I am very satisfied w/ your logic.

    A quick question: what charting software are you using?

    Thank you kindly,
    Steve

  5. Thanx for your analysis and your efforts to community. However from the charts the most visible senario is the RSI to turn down. The intervals frm ATH to ATH are 2-3+ yrs minimum. We already are at ATH so – i hope am wrong- its a matter of time to enter the bear market … and thats what charts are showing. If we set up for new ATH the RSI now standing in the miiddle of the range will go up high .. then invalidates the intervals..
    However the market will tell.. Besides its true market is more mature but need a ton of money to enter in so it can reach the projected highs…

  6. Do you mind if I quote a few of your posts as long as I provide
    credit and sources back to your blog? My website is in the exact same niche as yours and my visitors would genuinely benefit from a lot of the information you present here.
    Please let me know if this okay with you. Cheers!

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