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The world has buried Bitcoin many times for a relatively short period of time, but the world has buried the US dollar many more times.
Fundamentals
On February 26, 2022 happened the default of the dollar system - I suppose you agree that should have happened sooner or later. A kind of bloody hara-kiri of the dollar, which surprised the world.
Here is what Arthur Hayes (BitMEX) wrote about this situation:
The current petrodollar/eurodollar monetary system ended last week with the confiscation of fiat foreign exchange reserves of the Russian Central Bank by the US and the EU, as well as the exclusion of some Russian banks from the SWIFT network. A generation from now, when this sad episode of human history will hopefully come to an end, historians will point to February 26, 2022 as the date when this system broke down.
Usually, when we compare the BTC-USD pair, we perceive BTC as something volatile and USD as something stable. And until February 26, it was correct and logical. The officially announced default of the dollar system on February 26 has finally convinced the whole world that the US dollar has reached its practical ceiling, and then only a steep downward slope can await this pyramid. The very collapse of the US dollar, which has been talked about for decades, happened.
China refuses the US dollar and seeks to settle accounts with Russia in rubles and yuan. India abandons the dollar and chooses to settle in rupees and yuan. Saudi Arabia and the UAE are abandoning the dollar in favor of the yuan. The defaults of the US dollar and the euro simply buried any prospects for these currencies.
The BTC-USD pair can show a price of a million dollars per Bitcoin, not because the BTC has risen, but because the dollar has fallen. Considering the US dollar as something stable is already reckless, the situation has changed a lot. I note that the dollar system has not declared its default even once since its inception in 1945. Of course, the authorities do not call it the word "default", but prefer other words, but this does not change the essence. Whatever you call it, it's still a default. They did not have any legal grounds for freezing assets (moral grounds are a separate topic, and we will not raise it here), no clause of the contract provided for freezing, which means that by definition this is a default. Not surprisingly, not only Russia's obvious allies, such as China or India, but also supposedly US allies, such as the United Arab Emirates, Saudi Arabia, Turkey, and others, fled sharply from the dollar system.
At the end of this month, China may present a draft of a new international currency, which will be a reserve and replace the US dollar and the Euro. It is curious that the price of the new international currency will be considered as an index of the prices of the currencies of the participating countries, and the prices of key commodities. Of course, such a system is much fairer and more profitable for the participating countries than the dollar system. In the dollar system, only the United States was the beneficiary, which made this country so rich in the end. But for all other countries, except for the USA, the dollar system was unprofitable. In the new system, the situation is similar, but better. It turns out that it will be beneficial for all participating countries, and disadvantageous for all countries that do not participate in it. China, of course, does not invite Americans to this new system, but Russia is invited first of all, which is also not surprising.
February 26, 2022 is the most important date of this decade, it was on this day that the US dollar broke down completely, reaching its upper practical growth limit. Western analysts usually write that this should have happened no earlier than 2025, but Putin and Xi decided not to wait.
Nicholas Merten has stated that conditions may soon form that will help Bitcoin break out of a stagnant trend. Merten is confident that the current lull is nothing new and is a normal part of the Bitcoin market cap price cycle:
The way Bitcoin and the market in general are behaving now, I have seen too many times to count. Long-term investors have crowded out short-term investors, i.e. those who trade and speculate for fear of hoarding bitcoins.
Technical Analysis
Of course, the inevitable collapse of the US dollar due to the default is not an instant process and will last for years. Buyers and sellers are guided not by what has already happened, but by what will happen in the future in their opinion. The big escape from the US dollar will not be to one place in particular (not only to the yuan), but will be distributed among all the assets of the world, including both gold and bitcoin.
Technically, the Bitcoin is still in a growing long-term trend. Volatility decreases, and therefore we can draw a variety of triangles, depending on who has what fantasy, but triangles will turn out.
Fundamental and on-chain, they say that it is more likely to grow from current prices, but for the technique it’s still 50/50. I’m more inclined that there will be growth, not because of the technique, but the best thing is to see in which direction this triangle will be broken.
