The Best Ways to Trade the Coming Crypto Market Bounce | And More in This Weeks Crypto Update.

• Let’s take a look at a comparison between Bitcoin’s 2022 FTX crash and 2015 Bitfinex crash
• Ethereum’s 145-Days Cycle Calls for a Rally in December
• The Best Ways to Trade the Coming Crypto Market Bounce

Let’s take a look at a comparison between Bitcoin’s 2022 FTX crash and 2015 Bitfinex crash

The fall of FTX and the subsequent Bitcoin’s (BTC) price crash to new lows in 2022 resembles the same price action we saw in the aftermath of the Bitfinex-induced crash in 2015. This fractal comparison is a potential guide to what may happen next.

2015 Bitfinex Crash

For starters, the latest 2022 crash and the 2015 flash crash both have been triggered by macroeconomic events. Secondly, both crashes have led the Bitcoin price trading to new lows, breaking below the previous swing low.

The 2015 fractal pattern shows Bitcoin’s price entering into a multi-week consolidation pattern right after breaking into new lows. As a result, anticipations that Bitcoin’s price will undergo a similar consolidation pattern are increasing.

Notably, the 2015 price action saw Bitcoin price breaking above the previous swing high after 72 days. If the 2015 fractal repeats itself in 2022, Bitcoin’s price can break above the previous swing high of $21,500 by the end of January 2023.

The 2015 fractal map remains valid as long as the current swing low of $15,473 holds the downside. A break below November’s low will likely expose the 2019 high of 13,870.

Ethereum’s 145-Days Cycle Calls for a Rally in December

Since the start of the year, Ethereum’s (ETH) price has followed a 145-day low-to-low cycle that now calls for a rally in December. Additionally, the Ethereum price shows a clear seasonality tendency to produce high median returns in December.

ETH 145-Days Cycle

This cycle shows ETH’s tendency to bottom every 145 days or so. ETH’s price has followed this cycle very closely as follows:

• On January 23, 2022, we had the first major low of the year.
• 145 days later, we had the second major low for the year in mid-June.
• On November 10, 2022, Ethereum printed another low, which is precisely 145 days from the previous low.

The last 145-days cycle low coincided with the FTX-driven crash, making it more relevant.

We can also distinguish an almost perfect symmetry between ETH’s peaks and troughs. The 145-days low-to-low cycle can also be observed as measured from high to high. There has been a 133-day high-to-high cycle since the start of the year.

This means that every 133 days, we can expect the ETH price to make a high as measured from the previous high. If we project the 133-day cycle from the most recent high (August 14), we can expect the next cyclical high to develop on December 25.

The Best Ways to Trade the Coming Crypto Market Bounce

In light of crypto prices plummeting at one point in time, we’re going to see the crypto market bouncing back, the same way it did in the past following each crash. There are 3 key criteria to look for before an upcoming price recovery that every serious crypto trader needs to learn.

Earlier Bounces in the crypto market

The crypto market bounce off 2011: In 2011, when Bitcoin was at $32 and in a matter of 5 months dived back to $2, this was a 93 percent dive in price but recovered in the year to all new ATH.

Bear market 2014 to 2016: In 2013 the price of Bitcoin dived from $1.135 to $175. This is an 85 percent value drop in one month (December to January). This drop was partly triggered by the Mt Gox hack, where hackers got away with 850,000 Bitcoins.

The 2018 bear market: Still fresh for some crypto traders around this time, the value of Bitcoin dived from $19,640 in December 2017 to $3,185 in December 2018. This is a staggering 84% drop in value.

At the end of all three bear markets, Bitcoin bounced back and reached its new all-time high in months.

What is Bounce Trading?

In short, bounce trading involves buying a crypto asset when its price drops to a support level with the expectation that it will bounce back. This pattern happens after a decline in the price of a cryptocurrency.

3 Key Criteria to Look For a Crypto Market Bounce

1. The first thing to look for is the volume to confirm the bounce. Ultimately, the volume often reflects the cryptocurrency’s price, which is why we need to look for bullish days with increased volume. That’s a positive sign that the buyers have returned to the market.
2. The second thing to look for before a bounce is the overall market performance. For example, if Bitcoin’s price is bouncing, check if Ethereum’s price is following the same direction. Usually, BTC and ETH track each other’s performance as they move in tandem most of the time. The only difference may be the actual magnitude of the rally.
3. Lastly, check the technical picture to see if the price is still within a range or how far out of the range the price has moved. If the market bounce happens within a multi-week trading range, then the price is more likely to remain trapped inside the previous range. However, if the crypto price has a strong move outside its previous range, there is a higher probability of a follow-through.

While no one knows with certainty what the markets will do next, these are only some key clues to watch so you can make a better assessment of whether this is a dead cat bounce or a recovery.

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How Can Beginner Traders Reinvest Crypto Profits?

The crypto industry has numerous opportunities to invest and generate income from crypto holdings.

Cryptocurrencies are volatile and it’s important for investors to take profits from their investments instead of holding them for a long time. When investors take profits from their crypto investments, they can reinvest them and make more income in the future.

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