 Hey everyone! Today I'm going to be talking to veteran trader Peter Brandt and YouTuber streamer trader Eric Crown about the mercurial, ever-elusive Bitcoin market. As you predicted, Eric, we saw Bitcoin make a sizable move last week, which unfortunately was not in the direction we had hoped. You predicted that if we were to see a downward move such as this, Bitcoin could end up somewhere in the 6-7k range. Do you still stand by that prediction? And Peter, what do you make of Eric's assessment of the current trend of the market? Yes, so I do still stand by that. As long as Bitcoin is below about $9,100, I do remain bearish and I do believe that we have another leg to go. Probably back down to the $7,000 level, give or take, a couple hundred bucks. That does seem to be where a lot of things, a lot of tentacles are lined up with. I can bring up my screen share right now. So overall, Bitcoin does look to play off of this monthly 21 exponential moon average. From historical standpoint, we do see, and sorry, it's this yellow guy right here, we do see that that's kind of the general phase, I suppose you could say, for generally bullish or generally bearish. When we're below, generally bearish. When we're above it, generally bullish. As you can see right now, even with all this downside volatility, Bitcoin still has not even tested it. It's currently hanging around the $7,000 market right here. While that does look pretty nice and does look pretty beautiful, it does suggest that we probably do have a little bit more downside here to go. Based off of what we're looking at, of course, on the daily volatility metrics as well, we do see volatility is expanding once again after getting down to a piss-poor level, a level that we haven't seen since really May of this current year before this massive explosion from the $5,000 base to basically a 2X over the next week and a half, two weeks. So Bitcoin's bouncing right now and it's kind of held below all these major moving averages it looks like. We're kind of wedged between the 200 simple and the blue three sevenths, the next bunch of average right here. So we're probably going to play out a little bit of a bounce, maybe trade sideways for a little bit of time in this range between about $87.50 and kind of our base at around $8,000 low, I suppose. And things, as long as we're below $87.50, I do believe that this is kind of shaping up to be redistribution. How long does it take? Nobody knows, but as long, you know, my key point here is that, yes, I do kind of stand, I do kind of stick with that as long as we remain below $87.50, that's kind of my pivot for immediately being bearish. And then if we get back above $9,100, that would be kind of my full bowl, you know, no more bearish or anything like that. That's basically just, that's mostly based off of the weekly 21 expansion average, which I'll kind of just get rid of everything here. I do apologize for going a little bit more longer than I probably should have, but this one, this yellow move and average has been a pretty damn good, you know, decided once again of sort of which sort of phase that we're in. And when bookends in a generally bullish market, love to play off of it on its bullish dump, so you want to call it that. And in a bearish market likes to kind of use it as its resistance point. And right now, it's currently coming in right around that $9,100 level. And I'd have to say that as long as we're below there, I have a very hard time being, you know, like immediately bullish, so to speak. I'd love for Bitcoin to go back above there. And that would certainly change my mind. And we could get back to talking about bullish type of things. But as long as we're below there, I do believe that it's a lot more likely that we do hit that next target down towards about $7,000. What do you make of all that, Peter? Well, hey, hey, I'm impressed that a young guy uses moving averages to begin. I think that's awesome. I thought just as old guys use moving averages, but moving averages are a great, uh, default proxy for a trend. And so, you know, the question is, what's your time length? And everybody has different time lengths and different time lengths produce different things. You know, time scale is important. You know, whether you're looking at weekly or daily moving averages, you can oftentimes get different opinions based on the time frames you're using. But I think there's another thing, and that is Bitcoin is going to do what Bitcoin is going to do, and it doesn't matter what you think. It doesn't matter what I think. More often than that, it'll do what we don't think it'll do or at least do it not in a way that we think it's going to do it. But, you know, I look and, uh, you know, people who follow me know that I'm extremely long-term constructive on Bitcoin. But I think we've got some problems here. You know, the decline that we saw in September 24th was significant for me. I'm a chartist. I look at charts. I have to follow what the charts tell me, particularly look at patterns. And, you know, the chart patterns for me became very, very negative on September 24th. We completed a descending triangle top. We turned up on the ADX reading, which I follow as a confirming indicator. We also expanded and diverged the Bullinger bands. And normally when those things happen, the mistake is trying to jump in and pick a bottom too quickly rather than let the market play itself out. Try to find proof that we're going to head back to the upside. Right now, my default position is Bitcoin will move lower. I do have targets. They're lower than Erex. I think Bitcoin could go back 52, 53 hundred. I have a cluster of targets, depending on how I look at a chart and determine those. But, you know, 67, 6,800 down to 6,000, down to 5,300. But 5,300 is kind of in the back of my mind where I think this decline is going to take us. I think the big surprise may be that this extended sideways congestion lasts a lot longer. Everybody wants to either be bull or bear in Bitcoin. Well, how about just chop? And we could chop ourselves out for really perhaps the next six months. And that's going to completely wear out the bulls. And that may be what we need to have happen in order to really put an underpinning in this market and head it back north. What do you think about that, Eric? Do you agree with that sort of like long-term sideways chop that Peter is talking about? I think it's very, I mean, obviously, it's very possible, right? And it'd be the thing that probably most people don't want to happen the most, which means that it's actually quite likely. You know, Peter 100 percent nailed it. And most of the time, people want to be full on bull. They want to be full on bear. It's like joining a gang in a sense. You only want that direction because it appeals to whatever it is in your ego, I suppose. But at the end of the day, a lot of the times we're just chopping trendless. And while I do think that lower targets than 7000 are certainly very likely, myself as a trader, I take things one step at a time. And I do feel like there is a potential reversal point or at least structural support built up at around that $7000 level. Again, give or take a couple hundred bucks. If that bounce does get faded, if we see some sort of divergence play, if we see just something signaling that is Peter and out, then the next relevant level to the downside for me would probably be around the same area. I think obviously you have a lot of support built up in the mid-fives. And then after that, we see a lot of this market coming down to the monthly 55 exponential moon average, which for bitcoins all the way down in the mid to high 4,000s. A lot of alts are already there. Is that foreshadowing to a move in Bitcoin? It's which comes first, a chicker on the egg, right? And unfortunately, most of this market moves together. And I would say that's alts looking extra bearish, I suppose you could say, does bode a little bit on the worst side for Bitcoin overall. So I do think it's very possible. But again, myself as a trader, I take every major level as a potential, definitely a very, very likely bounce place and a potential reversal pivot as well. But that needs to be accompanied by getting back above a certain level that changes the structure. So for right now, that certain level still would be about 9,100. If we got down to that $7,000 level, if we maybe got back above perhaps, it's kind of hard to call it right now. But I'd imagine somewhere in the mid to high eights. And that would probably do it for me. But again, just kind of has to be taken once every time from my perspective. So, Peter, you tweeted last week that the hardest part of trading is not what to do when the world gets turned upside, such as now in Bitcoin. The hardest part is making the tough decisions in advance so that one is not forced to act in haste when things become crazy. Exactly what kinds of decisions are you guys making to prepare for events like this most recent market drop? Yeah, I mean, I think that was really a reference to what I sense, maybe correctly, maybe incorrectly from social media is that we've got a whole world of formal traders out there. There are people that really don't go into the day deciding here's what I'm going to do here and the conditions upon what I'm going to, how I'm going to act here. I'm going to, how am I going to preposition for tomorrow? How am I going to preposition for next week, for next month? On what basis do I make decisions? And that is my observation of an awful lot of participants in this market is they're flying by the seat of the pants. They're responding to quick movements in the market and that is idiotic. I mean, for me, the preparation was in making the determination during this congestion area that we had is that I wanted to reduce my holdings in Bitcoin extensively. I didn't wait for a big drop. I mean, I had been basically long Bitcoin. By the way, I'm not a day trader, but I'm also not a holder and I refuse to use the HODL world. But I'm a strategic holder. And that means that I want to sidestep what I think are extended periods of uncertainty or the possibility of extended declines. And so I think the hard decision was to exit Bitcoin during that congestion area and favorable prices and being willing to prepare yourself for a big decline, rather than waiting for a sharp down day where Bitcoin is down 10, 15%, and then deciding that perhaps you need to do something with the Bitcoins you own. So really, that was my reference for that tweet. Eric, how do you prepare for events like these since you sort of predicted this movement coming? Yeah, so my trigger as a trader when I kind of switched from being more bullish to more bearish was when Bitcoin lost that critical $10,300 level that we spoke about a month ago. That was a big deal for me. And just kind of piggyback on what Peter said there. My mentor used to always tell me, it's a little bit crass, but please stick with it. He'd say, the market will fuck you whenever it wants. And of course, when you fail to plan, then you have nothing to go off of. When you get into those more emotional situations, as Peter was kind of referring to, you're usually going to make the wrong decisions. So in those sorts of situations, I found that when I don't have a plan going into a major trade like that, it usually goes extremely, extremely poorly. So I completely agree with that. And overall, Bitcoin breaking that major level, that's kind of where I did change my mind on it. And unfortunately, it always feels bad, especially after riding a nice move to the upside. It always feels bad getting out of that position. But at the end of the day, trends are changing. And that's your job as a trader is to recognize when that change behavior has actually happened. Yeah, Eric, you just said something that's so interesting. Sometimes we exit the position, even though it's the right thing to do, it feels like an old friend died. Yeah. We get attached. We get attached. It's a human condition. We get attached whether we like it or not. So are we in a bear market right now? And if so, how are we supposed to survive this one? Go ahead, Eric. You go first. Okay, fair enough. Yeah. So are we in a bear market right now? Well, I don't necessarily think that going up 350% constitutes a bear market. We did have a reversal. And I do believe that we're going to be downtrending for a little bit of time. But the way that I look at out of bear market is prolonged downtrend over the course of in cryptocurrency language, about six months to a year in traditional world, perhaps multiple shares in some senses. So what I say that is Bitcoin in a bear market right now, I would not define it as such until we actually break major structural areas below about 4,500. That's where I become a long-term bear, talking about actual long-term trending to the downside, meaning that we just set in a major lower high at this $14,000 level and we're going to be sitting in lower lows along the way as well. Yeah, I would jump in here and just again make my comment relative to what I see from the technicals. And if you look at a weekly chart of Bitcoin and you define an uptrend as a series of higher highs and higher lows, we're in an uptrend. The long-term trend in Bitcoin is definitely up. But I use a proxy for a trend and that's an 18-week moving average and everybody has a different number that they use for that moving average. And I think the importance is one is consistent and one trades accordingly. But for me, the market is just hanging on. And should we go lower or sideways here for another couple of weeks, my 18-week moving average rolls over to the downside and that will then result in me declaring Bitcoin as in a bear market, at least in that timeframe. So, building off of that, over the weekend, Tommy Lee tweeted that excluding the 10 best days of the year, Bitcoin is down 25% on the year. He followed this by asking, are you that good at trading? And adding that he believes Bitcoin is weak in trendless macro. What does he mean by Bitcoin being weak in trendless macro? And what do you think about his observation of the Bitcoin market? Do you think that holding or, as you didn't say earlier, hodling is a better strategy than trading, as his comments seem to imply? You know, I'm an old guy. I mean, by the time Bitcoin becomes what everybody thinks is going to be, I'm well gone. And so, you know, I'm a swing trader and so, you know, I'm not going to be married to any trade. I've traded now for more than 45 years and I think some sort of absolute view of a market of any market and any time for any reason is wrong. I mean, I've approached the whole Bitcoin market as the fact that there's a 50% chance it goes to $100,000 or you name the price and a 50% chance it goes to zero. And so, you know, I want to be positioned accordingly in case it goes up, but I don't want to be married to Bitcoin and never go to zero because I think that still is a possibility. I'm not going to get into the reasons why I think it's beyond the scope of what we're doing here. And so I disagree. I disagree with Tom. Yeah, I think there's a time to own Bitcoin and not be a day trader with the idea that you're going to stay with it. I don't personally like to stay with the position that's going against me. Yeah, 100%. I'd 100% agree with that really because at the end of the day, when he says, are you really that good at trading Bitcoin? Well, it's a great time to be a holler in an upwards market. It's never a good time to be holler in a downwards market because Bitcoin loves to play out 80%, 90% retracement on average. And so when we're looking at just something as simple as perhaps just the weekly trend, just looking at higher highs and higher lows and lower lows and lower highs, just judging that. I mean, that could just be even a very basic way of doing it, but it works. And even just doing something very, very simple like that would offer better results than just blindly buying at any hour of the day. I would imagine that most people blindly buying during 2018, not so happy with a statement like that longer term perhaps, which again brings up that conversation of it's really comes back to your perspective. Myself as a day trader, well, I do care about, it does matter to me and of course that's the way that I'm going to trade. That's the way that I make my living. But I would imagine that a lot of people out there, this is maybe more of like a hobby or perhaps they're more of an investor like long term. And that's going to completely change that perspective. So would it be the worst thing to do? I mean, maybe not. I mean, all the people who bought in what is it 2014, 2015 during that bear market, they're quite happy right now as well, assuming that they did hold through it. But at the end of the day, it comes down to your personal perspective. And I'd say for myself, I disagree. Maybe for someone else, it could be true. Yeah. All right, this next question is for the viewers. Straightforward and blunt, is Bitcoin going to 100K or is it going to zero? Flip a coin. Yeah, it's the all or nothing proposition, right? At the end of the day, I'm a believer in Bitcoin, regardless of whether I'm bearish or bullish right now, I do believe in it long term. I think that I have a strong personal belief that anything that gives people more autonomous control over their lives, such as finances for one, is mostly a good thing and probably going to get picked up by the mainstream. It's just a matter of time. We do see all the traditional venues starting to build up infrastructure. We see CMEs not only offering futures, but now talking about options, which I'm elated about because that's where I come from. And then of course, we also see ETS being talked about, Batch just went live. So these institutions, and I'm sure Peter would agree with this, being a trader himself, these institutions, they're not wasting their time just putting up all this stuff. They're not trying to just go through the rigmarole for the sake of it. It means that they likely see that there's at least something there. And I do believe that adds on to the validity of this space as a whole. And if I had to give an answer, 100,000, do I know when that's going to happen? Hell no. We could be talking five, 10, 20 years out. I think a lot of people are maybe a little bit more on too much on the optimistic side for the bulls. Then again, it doesn't go to zero. Well, this is still an experiment, right? We don't know. I mean, there's legitimate concerns with this technology. Absolutely. I mean, what happens if quantum computing becomes a legitimate thing? What if it comes a widespread thing? Well, that would be an issue. It kind of makes the network a little bit less secure. So there certainly are still roadblocks in the way. But as a Bitcoin believer, I suppose I'd say 100,000. Are you still 50-50, Peter? Are there like certain factors you're considering? But you have to quantify that because yes, 50-50, but you have to look at risk reward. I mean, Bitcoin at $8,000 is a lot closer to zero than it is to 100,000. For me, what that means is this is a highly asymmetrical trade. I love asymmetrical trades. Give me asymmetrical trades. I've made my living on asymmetrical trades. And so with an upside potential of 92,000 and a downside potential of 8,000, if I can with basic, really simple technical tools such as a moving average, wow, it's a no-brainer that I'm going to be biased toward the long side. I'm biased toward 100,000 simply because it's a fabulous risk reward trade. So right now, are you guys, given that Bitcoin is kind of like unsteady right now, are you guys allocating more of your portfolios into altcoins or are where are you putting your portfolios right now? Fiat, baby. Fiat. Yeah, I'm holding the dollar shitcoin right now, unfortunately. My altcoin portfolio is the exact same whether it's a bull or bear market for Bitcoin. It is zero and will unlikely ever change. I think that's right on. For me, Bitcoin is crypto. Crypto is Bitcoin. If Bitcoin is not going to be a magnificent long-term play, these altcoins and other macro caps are worthless. My interest is in Bitcoin, Bitcoin alone. I look at these altcoins, I think they're a big distraction. Yeah, agreed. Now, don't get me wrong, though. I do think you'd be a little bit naive to believe that every single altcoin is just completely worthless. We have thousands of these guys, but at the end of the day, maybe a handful are going to be successful, but it's really going to likely come off the back of Bitcoin to begin with anyways. Bitcoin is the frontier, in a sense. It has the most history going on right now, and if Bitcoin doesn't succeed, it would greatly diminish the case for anything else I'd imagine. You get all of these, I call them cryptomaniacs. They're reinventing technical analysis in a way that makes the fathers of technical analysis roll in their grave. I mean, they're just making up the rules as they go. It's crazy. I look at charts on Twitter and I go, whoa, this is a map to the outer space, but simple moving averages or exponential moving averages. Man, I mean, they're so useful. The basic stuff is really where it's at as far as I'm sure. That's the thing. I started out being a market maker on the floor of Neostart Change Arcus, so my mentor down there who had been doing this for about 35 years at the time, he was all about EMAs and moving averages, so that's kind of how I learned from that. You said it perfectly. I mean, there's some very simple strategies that require a lot of patience, but they work.