In today’s session, we focus on the aftermath of the LUNA fiasco. What we are looking for are changes in investor behaviour patterns. Some examples of things we WANT to see before expecting sustained upside:
- Old hands holding tight (i.e. not spending out of fear of downside)
- Young coins getting older
- Accumulation from of wallets increasing
- Realized profits rising alongside upside price action
Right now, we only have the third point, wallet accumulation, taking place. And even then, it appears to be a sub-set of the market.
Of course, any sign is a good sign at this stage, but what we don’t have is an across the board, 10 out of 10 buy signal. Certainly the oversold conditions would favour a bounce from here. But it has serious headwinds to get through first, and that alone puts it at odds with further downside.
My instinct tells me we have time pain ahead of us. What I mean here is we trade sideways to down, its volatilie, but over the next few months, we make NO progress in either direction. Just painful, boring, sideways chop.
Time makes people leave these markets. And that is how bottoms get hammered out.