Why so many people missed this bull run – 29 March 2022

The indicator we all chosen to miss – although we’ve seen it

It can always be a fake out, however after we failed to indicate breakouts time-after-time lately, I advise everyone (including me) to step back and re-evaluate what happened here in the past few weeks.

For me, I would say that technical indicators are fantastic, I will never underestimate decades of knowledge that have been proven, some of them are exact science in my opinion (based on mathematical backbones), however others are just horoscopes. And the worst thing (like in religion maybe, and other fields as well…) – the theory is great however extreme biased interpretation might lead to a disaster.

Technical Analysis HAVE to be crossed checked with some macro indicators (interest rate, debt, etc.), geopolitical issues (from Covid till Russia-Ukraine war), mood (fear & greed, social indicators), and (I think most of us missed on this one, therefore an artificial pause is necessary here) –

BTC supply and demand

While demand is something we use to measure (and feel) all the time, some assume supply of BTC is fixed (Michael Saylor preaches that constantly), however it’s not, not even close. Three examples –

  1. The 21 million BTC is quite a meme. There are almost 19m BTC in circulating supply currently.
  2. The (almost) 19m BTC in circulating supply is nice for background knowledge, however some of them are probably lost for good. There’s no exact number, however certain analysis points say 10% while other claim that 20% are lost forever.
  3. Well 90% of the 19m BTC is nice to know about, however BTC held on the exchanges dropping down dramatically over time:
BTC reserve on exchanges over time – QryptoQuant

And that’s the main point here. This can go on and on, cause there are short term and hold term holders, institutional investors and so on, however that’s enough to depict the picture in here – BTC actual supply is shrinking over time.

Demand indicator, Social Analysis by CoinDesk – not much attraction lately

Bottom line

A recession can shut this down for several years probably. Some crises like Covid or war – draw us back for a while. Otherwise – the only way is up, as explained above.

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