Welcome to another edition of the Boss Crypto “Letter To Investors” series. Thank you for taking the time out of your busy schedule for us.

The last week has been relatively uneventful, as I expect the next part of the cycle to be so I took some time to write an analysis of longer-term Bitcoin trends.

The Markets

I believe that it is important to talk a little bit about where we are right now. My opinion is that we are in the depression stage of the cycle. A lot of altcoins are down over 90% and that is a big number.

Do you know how far Amazon stock dropped in the tech bubble from January 2000 — September 2001 (20 months later)?

It dropped 95% — Sound familiar?

During this time nobody wanted to touch it, the market could only think of negative reasons why the price would go down forever. Investors were pessimistic, and nobody had the courage to act.

Some companies died, forever, but what came next was the re-birth of something 100x bigger. It went from a tech bubble to the tech revolution. And you wouldn’t be here if, at some stage, you didn’t believe in the blockchain revolution. Now, we don’t know now what companies will be the next blockchain Amazons, but we are looking for them every day. And we will find them.

While we move through this stage of the cycle, capital will be tight, and we need to be even more prudent with our investments. Keeping portions in cash, taking profits earlier than usual or making long term investments that you intend to hold for long periods of time. And even with these long term investments, you should have exit rules, both profit — and loss.

Price cycles around a trend. This is something we all know.

Using trends as forecasts for the future price of an asset are simply extrapolations of the past into the future and there is no guarantee that the previous trend will repeat exactly. I believe they offer a good amount of insight into the flow of price, yet would not trust it, for example, to predict the exact dollar value of Bitcoin in 2021.

The below is a simple breakdown of the past trends as they were before the bulls took over and blew the price to crazy highs.

This phenomenon is in no way just related to cryptocurrency trading and investing. It happens in every market. Why? Because humans are involved in every market.

Firstly

You can see the % retrace marked in blue. And you can see the horizontal green box, which was the depression stage at the end of the 2015 bear market, duplicated to today's market.

Secondly

You can see there are two main lines that I am looking at.

The highest of the two was the 2012–2013 bullish accumulation period before the major breakout at the start of 2013 and the second is the bullish accumulation period from the end of 2015 to the start of 2017 before the major breakout.

As you can see, the second accumulation trend was at a slower incline than the first, and I believe that was caused by a much larger collection of money in the pool.

From this data, I would then make the assumption that the next bullish accumulation trend, after the depression period, will also be slower than the 2015–2017 trend, yet might catch up at the peak of the breakout.

Thirdly

You can see similarities in volume. I wanted to talk about this because the volume charts look similar across most exchanges that were trading Bitcoin during the last bear market. The amount of volume in both the bull market and bear markets of 2017 and 2018 was lower than the volume of the 2014–2015 markets.

However, the shape is the same:

1. A build-up of Euphoria

2. Mass Panic

3. Uncertainty

4. More Panic

5. Unknown in 2019, and in 2015 we saw more uncertainty, or as I am referring to it: Depression.

Conclusion

There is no way that we can know for certain what is to come, and it is unlikely to repeat exactly however this picture does show us a clear picture on the past market performance in all times, across all emotions. It is a complete picture.

The depression cycle is always (not just in cryptocurrency) the most important to be vigilant to new investments. While a lot of old projects will succeed, a lot that came through in the ICO boom are dying, new ones will be there to take their place.

To your 2019,

Boss Cole, CEO — BossCrypto

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