Bitcoin's July Trap (Is The Bottom In?)

If you've been following me this year, then May and June have been no surprises. We have been talking about this crash trap crash trend ever since January really. And as we close out May and June, we're going into July where I have drawn up as a potential trap opportunity and potential relief rally before a lower low in August and September. So that's pretty much what we're going to be talking about today. So on February 8th, I basically spoke about June, right? You can see I posted this February 8th on Instagram and June was a capitulation. Probability of a major flush 55%. Now I got the timing correct. I did not get the pricing correct. So I will call myself out on that. Now I was pretty close. It was 42 to 55K. I think I I was overconfident on it being a much rougher um bare market similar to 2022 and 2018, but you know, we've it hasn't been as rough and you know, it shouldn't be with diminishing draw downs, right? Got the timing right, didn't get the price right, and that's kind of the common theme in crypto. Now, if you weren't following me back in February when I posted about the uh June predictions, um I also posted about it on the 1 of June. So, I told you guys that the price would drop in May. We were sitting at $78,000 when I made the the post on May. Uh we ended up closing around $71,000. And then I started speaking about June that it's one of Bitcoin's weakest months in basically its its history, right? Just the summer overall is very very weak for Bitcoin and crypto overall. I pointed out how four of the last five Junes closed red and when May closes red, June has tended to follow it lower. So with May closing in red, the prediction and it was was pretty straightforward. You know, historically that means that June is likely going lower at that point. So now I do believe that it is uh time to reverse a little bit here and that we're due for a relief rally, right? Price doesn't go down in a straight line. You can see the same pattern play out. We had 1, two, three, four, five, six, seven weeks in a row of a crash. 1, two, three, four, five, six weeks in a row of a crash here. And now we've had one, two, three, four, five, six, seven, eight. eight weeks in a row now of a crash here. Um it might be seven because this one is still open, right? This one might end up green overall. So, we're due, right? We're we're right at that threshold where usually um things change a bit and uh we we it goes from going straight down to either consolidation or a small move up like we've seen in these previous two traps. You can see that I've been posting the same exact chart since March when I was calling for that trap in March and April and it's exactly what we ended up getting. So you can see how it was there and then you can pretty much see how it's developed over time, right? We had that trap in March that March and April that we spoke about. So this was the end of that trap in March, April and we started talking about May, June, right? So we were all the way at the top here. Everybody was saying that the bare market was over. We were calling for price to go lower for lower legs in May and June. If we continue up higher to the updated ones. Let's see where's the next one. We got the trap play out just pretty much as we uh drew it up and then uh the crash here in May and June. And you know, skip all the way to the last update that we put and look at that now. Now, we went from where we were way up there when we started this uh call for May June, crashed all the way down, and now we're entering the trap in July. So, let's go ahead and jump into it. So, let's let's talk about why the bounce is real for July and for crypto in July. On all of these charts, the 4 hour, the 8 hour, the daily, and the weekly, the RSI has been printing bullish divergence, right? So let's pull that up on the chart so you see exactly what it is that we're talking about. So on the bottom here we have the RSI. On the top we have price. So what happens here and what bullish divergence is is when RSI goes from a low to a higher low, right? That's a a change in the trend really. While the price goes from a low to a lower low. So there's divergence, right? these two things are not uh agreeing with each other and what happens in these scenarios is that price eventually reverses and follows momentum right so the momentum has for for the move down has been falling off right so that kind of signals that buyers are uh well that sellers are getting exhausted and they can't progress the price it's harder for them to progress the price lower basically so we can see this at the low time frames this is currently the 4hour time frame. We can also uh go to the higher time frames. So if we go to the 8 hour time frame, we're seeing the same exact thing here. We see price the RSI had a low here and look at when we hit this low here. Look at the RSI. It wasn't even anywhere close. It didn't even get to oversold at all. So that is bullish divergence. Um if we go to the daily, we're going to see the same thing here. So again, here it is. We have the low. We have a lower low. We have a low. We have a higher low. So again, bullish divergence. Then if you go to the weekly, and it looks funky here. I don't know why it it looks so so uh so weird on here, but it's the same idea, right? Same idea. We have a uh a low, then a lower low. However, the RSI on the weekly is showing a low and a higher low. So all of those agree, right? We can see that and that's that's obvious right now. This is what happens usually when we have those setups. Price ends up going higher 71% of the time a month later. Right? So this same exact scenario has showed up 17 times in 15 years. Right? So that's not a lot. It's not a big sample, but it has shown how often Bitcoin was green after this same exact setups. This is a month later, two months later, and 3 months later, right? So, a month later, 71%. Uh, two months later, kind of the same thing, 71%, and then 3 months later, you can see that drops down to 59%. Right? So, that starts dropping back down. And that's actually kind of plays into our overall thought of how this uh bare market plays out, how the next few months play out because we think over the next 30 days we'll see that relief rally and then after that I'm thinking that we might drop even lower, right? Cuz this relief rally is going to set up for a lower low. So this number is going to end up dropping even lower probably even this one to be honest. So now let's continue here and this is the next uh proof here the next confirmation which is a red May red June usually means that July bounces right so this has happened four out of four times in 2013 in 2018 2021 and 2022 the average has been about a 16% recovery um 2026 sets up the fifth time that this has happeneding So we can see the numbers here from every time that this exact same scenario has happened and it's always played out the same exact way. So we are running into the same situation once again. We're currently down 20% for June and we were down about 3.4% in May. Right? So this is setting up for potentially a green July. And then we can see that in 2022, you saw the same thing. Look at what happened in July, 16%. Same thing in 2021. Look what happened in July, 18%. If we go down to 2018, look what happened in July, 20%. If we go all the way down to 2013, back-toback red months, look what happened in July. Right? So, we can see it um very clearly, right? However, again, it's only four data points, right? So, you have to take all of this with a small grain of salt. But that's why we we are looking for multiple confirmations, not just one confirmation. If it was just this, then eh, you know, it it's not really a big deal. But because it's so many different confirmations that we're kind of piling on top of each other, it makes it it makes it more significant, right? and it gives us a higher probability of seeing a similar scenario. So now the next thing I want to point out is just July's overall, right? July's overall during bare markets have always been green, right? In 2015, in 2018, and 2022, they have always been green overall. So in years where Bitcoin's price has ended up bottoming, July has typically been green, but again two or three uh uh points, right? So it's not statistically significant. However, when you put this data with along with the other data, then it becomes more significant. Right? So this has happened three out of three times. And if you want to see my report for July, you can comment July in the comments of this YouTube video and I'll be more than happy to send you guys the free PDF that I created that I've been sending over to people on Instagram um that talks about everything that we're covering in this video. So, now that we've spoken about why I believe we're going to likely get a relief rally in July and we're going to be going higher before we go lower, let's talk about the reasons why it can go lower, right? So, I like to look at it from both perspectives and then kind of make decisions based on that. So, let's kind of dive into that on what they're looking at, what they're paying attention to, and seeing if there's there's a reason to believe that, you know, that could happen as well. So, the first one is the long-term momentum rolled over, right? So, this is based on the MACD. So, if I pull up the MACD here on my chart, you will see that it had a bearish cross. So a bearish cross here when the red line goes over the blue line and the blue line drops beneath the red line right that is a bearish cross and the reason this is important is because this has happened seven times across the years right on the weekly chart and anytime this has happened Bitcoin's price has gone lower right from where wherever the price was during the time of the bearish cross. So that's why it's something that we need to kind of keep an eye on. 7 for7 including every single bare market in 2014. You can see it happened twice in 2014. Uh after the first one it went down 39%. After the second one it went down 64%. Right? Then we saw it three times in 2018. After the first one dropped 25%. After the second it dropped 49%. After the third it dropped 43%. Right? And then we saw it again in 2022 where it dropped 52%. And we even saw it in 2021 right before uh it we went into 2022. But the thing to remember is that at in December of 2021, we were already in the bare market. We had already topped, right? So after it signaled in 2021, um we dropped 40% further. So those are all kind of important things to note, right, and to keep in mind uh for the longer term. This is basically graded within the next 6 months. So I mean we can even go all the way back here to 2025 where we actually did get something like that. So if we go here, we see this happened August 18th. So let me see where we were right here. August 18th. And you can pretty much see since August 18th, we ended up going down basically across the the next few months. You can see all the way to January, price went down 26%. If you go further out, you know, obviously the further out, the further down we're going to be. And if we just go all the way to when we crossed back, let me see. We crossed back bullish right here. So, you know, price would have been down. Let me see. Was it here? No, it was this one right here. Price would have been down about 39 to 37% depending where you got that signal, right? So, it's definitely something to be aware of. However, it's not something that happens usually right away. You can see that this is within that the next six-month period. The next thing is that Bitcoin has never bottomed above this line which is the realized price line. Right? So the average holders break even line. That's the MVRV line. Currently that line sits somewhere around 52 or 53,000 and we're currently above that range right now. And historically Bitcoin has bottomed below this line every single time, right? Every single Hing. Now remember with diminishing returns we also have diminishing draw downs. So will price go below that line? It is possible but it's not guaranteed because like I told you in the beginning of this video what's the the easier thing to try to kind of predict is the timing aspect of Bitcoin. What's very very difficult to predict is the pricing aspect. So this is this one's kind of you know it's happened four out of four times. Again it's only four uh scenarios though. So statistically insignificant right four data points. And then another thing to look at is the dip under the line is shrinking right. So during the 2011 bottom the dip under the line went 58%. In 2015 it went 44%. In 2018 it went 31%. In 2022 it went 25%. So, I would imagine that this continues to play out and um the dip below that line, if we do get to that line, will be less than 25%. Maybe around the 15 to 20% range um would be my expectation, right? However, again, we don't really know yet. the price. It's what's the most difficult to to predict, but this is something to keep in mind for the longer term over the next few months, not specifically for July. So, both columns are real, right? Both hope and the trap. I do believe that price is going to go up in July. And I also do believe that we're going to go lower um before we bottom. Right? So, I think both these camps have a point. I think we're going to have a relief rally in July and then I think we're going to go lower and set a new lower low potentially uh hitting that uh where past bottoms that realize price area, right? Um but I'm more I'm mostly focused on when to buy in, not exactly at what price to buy in. So kind of both arguments just kind of play into exactly what I already believe. Now, I'm not going to put the exact timing on it in this video. I already spent like 30 minutes on that in the past video. So, if you guys are interested in that video, I'll pull it up for you real quick here. If this loads, here we go. You guys can watch this video right here where I tried to prove the Bitcoin for your cycle wrong with data. um where I speak specifically about why timing the market is easier than trying to time than trying to predict the price, right? Uh and it kind of goes back to all that, you know, what I've been saying throughout this entire video that I think, you know, we have a better shot at predicting price, I'm sorry, at predicting time than predicting price. So, July is the bounce, but I don't believe the bottom is in yet. I'm just kind of playing the data and playing the chart, right? So, if we go over here, you know, we are due for a relief rally. I believe that happens in July. However, we're still in a downtrend and there's still a lot of things pointing for Bitcoin to go lower. So, I believe that we also go lower. So, next month, we'll look back on this and see if it played out the way that we thought it did or if it didn't and the reasons why. So, I'll see you guys on that next