Bitcoin Price Analysis And Macro Overview
Listen To The Episode Here:
“Fed Watch” is the macro podcast for Bitcoiners. We discuss the latest macro news from around the world, with a focus on currency and central banks.
In this episode of the “Fed Watch” podcast, I sit down with Tone Vays, a true Bitcoiner and long-time price and macro analyst of Bitcoin. Our discussion covers everything from current conditions to bitcoin cycles to larger macro topics such as the state of U.S. political, European and euro politics.
You can find the charts for this episode here.
Current Bitcoin Market Conditions
In the first segment of the podcast, Vays talks about the psychological state of the bitcoin market.
“I was around for the last two bear markets. 2013 was the classic bubble chart, you were mentally prepared for what’s to come. 2017, again, the ICOs, it was an unreasonable exponential rise, so you were mentally prepared. I was not mentally ready for this one. Because, when the top came in April 2021, we had an incredible amount of good news. Elon Musk, Jack Dorsey, and Michael Saylor all left Twitter to get into Bitcoin with Square El Salvador [legal tender law], El Salvador then El Salvador buying bitcoin.
“That turned into a sell the news event. 50% correction, no big deal. Everyone was fine with it. This is where your mental state matters. When we went back and broke that top in November, that was the breakout. Everyone thought we were moving higher, but I thought we were moving higher. The November fake out was extremely difficult for me. We crashed back to the $30,000 low, broke down to $20,000, and over the last three to six months people have been very, very concerned.
“This prolonged move has made people tighten their belts. They feel like they have been cheated and don’t believe bitcoin should be at such lows. Bitcoin was created for the uncertain world we live in right now. They are stealing bank accounts not only from individuals, as in Canada, but also from sovereign countries. This is why Bitcoin was created, and the price keeps falling. People are beginning to give up. Everyone is saying lower, lower and lower. This is where I have to believe that the majority is always wrong.”
I asked Vays about bitcoin valuation models and four-year cycles. I wanted to know if they are all broken or if we should look for a new model. He said that he believes models always fail. Vays believes stock-to-flow is theoretically correct, but cannot be used as a technical indicator. Vays believes the four-year halving period is partly due hype and partly due actual supply shocks.
This is also my position on “Fed Watch”. The four-year halving cycle is its own hype cycle and completely separate from the overall bitcoin hype. Similar to altcoins trying to hype hard fork upgrades, bitcoin achieves this naturally through the halving.
However, I think the hype is lessening with each cycle, along with the supply shock aspect. This is why I believe we now have a two year cycle. Although the halving has a smaller effect, it still creates an echo several years later.
Vays wisely points out that it is harder to distinguish between bull and bear markets. Price action in 2020 and 2021 do not lend themselves to a clear dividing line. These cycles will be more difficult to define in the future.
Europe Crisis And Global Macro
We started running up on our hard time limit before we got into the juicy stuff, so hopefully we can have Vays back on in a few months to continue this discussion. We did get his views on Europe and the euro.
“I will say that I have a very low opinion of Western Europe. It’s nice, you can go there and it’s secure. It’s safe to walk on the street. You can still see remnants of a crumbling capitalist society as they hand over power to the World Economic Forum (WEF). The WEF is a liberal socialist organization, according to me. They have too much power over politics. Klaus Schwab said, “We have penetrated into the cabinets.”
” I think the WEF’s path is very dangerous and I doubt the future of Western countries who buy into its power. That’s why I am very bearish about Europe. I think the common currency will break up.”
We talk about so much more, from bitcoin’s correlation to stocks and altcoins, to monetary policy. This is one of my favourite episodes on Fed Watch. It is definitely worth a listen.
That does it for this week. We are grateful to all our listeners and readers. Please subscribe, review, and share this content if you like it!
This is a guest post by Ansel Lindner. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
Frederick has been an active trader for over since 1991. After successfully navigating the market for so long, he’s finally bringing his wisdom to the masses.