Are you into crypto? Social media tells you to trust data models and cycle theories like power laws, four-year cycles, and stock-to-flow. Should you? They all disagree with each other and have no predictive value (unless your prediction is, “Bitcoin’s price will go up in the long run,” but you don’t need a data model to tell you that). I looked at a bunch of models for a series of Medium articles. I will link to those articles at the bottom of this post. Let me first flag some charts that sound compelling but won’t help you spot the peak. Logarithmic growth curve “LGC” say Bitcoin’s price moves up and down within a defined range of prices denoted as curves on a price chart. Many variations exist. On one variation, we may have already hit the peak. Look at this chart from the alert I sent to subscribers of my Crypto is Easy newsletter on December 20, 2024. Fortunately, I can adjust the line slightly to give you an extra 50% upside while still connecting major cyclical peaks. Both curves are valid. Each gives a different target. Likewise for all versions of logarithmic growth curves. A little tweak to the line gives you a very different result. 2-Week RSI This indicator shows a bearish divergence on the two-week trading chart, where Bitcoin’s price goes up but its relative strength index goes down. Some point to this as a reason to expect a bear market now, but this divergence has happened multiple times without marking a major cycle peak. Of the eight previous divergences I could identify with my basic trading skills, only two resulted in a meaningful, long-lasting decline you could reasonably call a bear market. (Five of them resulted in a temporary decline of some kind.) See this chart, which zooms out for a full picture. Power law Experts say this is the most accurate model. Look at these lines! Unfortunately, power law doesn’t tell you when the market’s peaks and bottoms will come. It gives you a trajectory — up and to the right. But we already know that is the path we’re going to take! One of its promoters said my Up and to the Right (U2R) model predicts a similar outcome. That’s cool. The U2R model is simply a line I put on a chart. No math, data, or research. It’s nice to know a real analyst came to the same conclusion. While we can get a range of prices power law and U2R, that range is huge and useless for spotting peaks and bottoms. Expanding cycles For all we know, Bitcoin may have just proven the much-maligned “expanding cycles” theory was correct. Bitcoin’s run to roughly $108k fits nicely. Fortunately, how you draw those cycles is completely arbitrary. You can move the boxes to any place you’d like. If you try hard enough, you could make a case for shrinking cycles. For my further thoughts on these and other data models and psycho theories, start with this Medium post: https://medium.datadriveninvestor.com/bitcoin-cycles-and-models-a-realists-perspective-41c660f1c679?sk=e1a8e7a02a6460c9718e45acc7612492&embedable=true An alternative Whether they're created from math, patterns, or your imagination, models and theories work or don’t work depending on where you draw the lines. They change depending on what data you choose. Change one variable, and you can get totally different results — without any clearer picture of where and when the “peak” will come. You want to take a different approach. Try my plan. https://cryptoiseasy.beehiiv.com/p/plan-buying-selling-bitcoin?embedable=true Three lines on a chart tell you when to buy, and two metrics tell you when to sell. Sign up for the Crypto is Easy newsletter for other useful tools like my “Danger Zone” and altcoin reports. Mark Helfman publishes the Crypto is Easy newsletter. He is also the author of three books and a top Bitcoin writer on Medium and Hacker Noon. Learn more about him in his bio and connect with him on Tealfeed. Are you into crypto? Social media tells you to trust data models and cycle theories like power laws, four-year cycles, and stock-to-flow. Should you? They all disagree with each other and have no predictive value (unless your prediction is, “Bitcoin’s price will go up in the long run,” but you don’t need a data model to tell you that). I looked at a bunch of models for a series of Medium articles . I will link to those articles at the bottom of this post. Let me first flag some charts that sound compelling but won’t help you spot the peak. a series of Medium articles a series of Medium Medium articles Logarithmic growth curve Logarithmic growth curve “LGC” say Bitcoin’s price moves up and down within a defined range of prices denoted as curves on a price chart. Many variations exist. On one variation, we may have already hit the peak. Look at this chart from the alert I sent to subscribers of my Crypto is Easy newsletter on December 20, 2024 . the alert I sent to subscribers of my Crypto is Easy newsletter on December 20, 2024 the alert I sent to subscribers of my Crypto is Easy Crypto is Easy newsletter on December 20, 2024 Fortunately, I can adjust the line slightly to give you an extra 50% upside while still connecting major cyclical peaks. Both curves are valid. Each gives a different target. Likewise for all versions of logarithmic growth curves. A little tweak to the line gives you a very different result. 2-Week RSI 2-Week RSI This indicator shows a bearish divergence on the two-week trading chart, where Bitcoin’s price goes up but its relative strength index goes down. Some point to this as a reason to expect a bear market now, but this divergence has happened multiple times without marking a major cycle peak. Of the eight previous divergences I could identify with my basic trading skills, only two resulted in a meaningful, long-lasting decline you could reasonably call a bear market. (Five of them resulted in a temporary decline of some kind.) See this chart, which zooms out for a full picture. Power law Power law Experts say this is the most accurate model. Look at these lines! Unfortunately, power law doesn’t tell you when the market’s peaks and bottoms will come. It gives you a trajectory — up and to the right. But we already know that is the path we’re going to take! One of its promoters said my Up and to the Right (U2R) model predicts a similar outcome. Up and to the Right (U2R) model That’s cool. The U2R model is simply a line I put on a chart. No math, data, or research. It’s nice to know a real analyst came to the same conclusion. While we can get a range of prices power law and U2R, that range is huge and useless for spotting peaks and bottoms. Expanding cycles Expanding cycles For all we know, Bitcoin may have just proven the much-maligned “expanding cycles” theory was correct. Bitcoin’s run to roughly $108k fits nicely. Fortunately, how you draw those cycles is completely arbitrary. You can move the boxes to any place you’d like. If you try hard enough, you could make a case for shrinking cycles. shrinking For my further thoughts on these and other data models and psycho theories, start with this Medium post : this Medium Medium post https://medium.datadriveninvestor.com/bitcoin-cycles-and-models-a-realists-perspective-41c660f1c679?sk=e1a8e7a02a6460c9718e45acc7612492&embedable=true https://medium.datadriveninvestor.com/bitcoin-cycles-and-models-a-realists-perspective-41c660f1c679?sk=e1a8e7a02a6460c9718e45acc7612492&embedable=true An alternative Whether they're created from math, patterns, or your imagination, models and theories work or don’t work depending on where you draw the lines. They change depending on what data you choose. Change one variable, and you can get totally different results — without any clearer picture of where and when the “peak” will come. You want to take a different approach. Try my plan . my plan my plan https://cryptoiseasy.beehiiv.com/p/plan-buying-selling-bitcoin?embedable=true https://cryptoiseasy.beehiiv.com/p/plan-buying-selling-bitcoin?embedable=true Three lines on a chart tell you when to buy, and two metrics tell you when to sell. Sign up for the Crypto is Easy newsletter for other useful tools like my “Danger Zone” and altcoin reports . Crypto is Easy Crypto is Easy Crypto is Easy altcoin reports altcoin reports Mark Helfman publishes the Crypto is Easy newsletter. He is also the author of three books and a top Bitcoin writer on Medium and Hacker Noon . Learn more about him in his bio and connect with him on Tealfeed . Crypto is Easy Crypto is Easy Crypto is Easy Medium Medium Medium Hacker Noon Hacker Noon Hacker Noon bio bio Tealfeed Tealfeed

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