Crypto winter is dead… Long live the CryptoSpring
I know that as the title of this post, the phrase could be described as risky at least, but it is not formulated from a subjective approach, it is made from a totally objective and quantitative approach, based on events that have happened in the market and that we have commenting several weeks
The processes of market change
The change of sentiment in the market is usually a slow process that needs a certain development time. If we talk about the long term, changing the criteria of the majority of the investing mass is not something simple, and except in extreme situations, this does not happen in a few hours.
It needs a series of events to occur that convince investors that they must change their criteria regarding current prices, going from overweighting them to undervaluing them, or vice versa.
Obviously, these investors are not going to change their minds at the same time, but depending on various factors such as risk aversion, they will be incorporated into the new trend.
Sometimes we can also see how these movements end prematurely without having reached the proposed objective and in the end the market ends up continuing the trend that everything seemed to indicate was ending.
As always… uncertainty is present
Believe and trust what your graph says
Within this fickle and liquid scenario, if I had to give advice, it would surely be this: You must trust your analysis and your way of seeing the market (if you don’t do it… who will?)
Following this maxim, we can only say that Crypto Winter is over, naturally assuming a considerable margin of error, but this is what the graph tells us, and now we are going to explain the reasons that prompt us to adopt this position, simply from a technical point of view
End of the crypto winter
The usual followers of this comment surely already sense the approach that we are going to carry out, but this time we want to give it a slightly more macro vision, so that we can appreciate the total impact, and dedicate the post in a monographic way to this topic for the importance it has
Technical Analysis as a quantitative indicator
In the analysis of the situation, it is going to be the graph that is going to give us the data on which we are going to support our theory, in this case, BTC and ETH
In both cases we can see how the long-term bearish guidelines originated in the historical highs have been broken, leaving us technically in a favorable situation for a significant change in the market.
But if we go a little beyond the charts, we are also finding positive news, the number of which has increased significantly in recent weeks. Mainly news related to adoption processes at the institutional level. Although this is not definitive news, that is yet to come, but they are clear indications that organizations are preparing for the management and adoption of digital assets within their business models.
Special attention deserves in this aspect, the news related to the technological sector, with the movements of giants like Google in this regard, or the current situation of Twitter, which will surely provide good news in this regard.
The financial sector is not lagging behind either, and this time we do see that they are timidly adopting a more favorable position to work with digital assets from the moment that the regulatory environment of the necessary and essential legal coverage
Is it time to invest?
We will never be able to know if it is the ideal moment, but from my point of view, the configuration of the current scenario suggests that it could be a good opportunity, since the technical disposition of the market leads us to think that we have already left the crypto winter, although the crypto spring has not yet manifested itself clearly
As always, depending on the risk profile of each one, it will be necessary to find the ideal moment to take positions. What is clear is that the market has a different disposition than two months ago
Remember the quote:
If you use a trend strategy, never invest against the trend
Based on this principle, long-term investors should have stayed out of the market until now. The window of opportunity is beginning to open, but as always, crossing the threshold falls within the scope of each investor’s decision