There are few numbers in Gann’s analysis more important than the number 7. 7 hours, 7 days, 7 weeks, 7 months, 7 years, etc. The number 7 in Gann’s analysis was a signal. He called it his, ‘death zone’. The series of 7 that Gann frequently referenced was the 49-day (7 weeks) cycle. Not only was that a ‘death zone’ but the 49-day cycle ended ‘blow-off’ moves. That cycle completes right on one of the most important calendar days in Gann’s analysis: February 5th.
On January 16th, Bitcoin was trading around $12,000. I posted an idea on Tradingview that day. The idea forecasted us to the $7000 level by February 5th before we begin the next impulse wave up.
I have been talking about an extremely important confluence zone of time cycles for all markets and reversals in all long trending instruments. We are already witnessing a roll over the equity indexes, reversals in some long trending currencies and reversals in some commodities. Bitcoin and cryptocurrencies are the laggards in their response to changes to the trend and that is primarily Bitcoins faults. We have 3 days of this 49-day (can go to 52 days) cycle remaining.
I want to post this chart to show something interesting. Every instrument likes to move to a certain ‘rhythm’. Some stocks like to swing and move in a certain amount of days, some like to move a certain number of points/pips/satoshis. Bitcoin, since it’s all-time high, has large swings that like to move in -46% retracements. The current swing we are in doesn’t end its -45% retracement until the 6800-7000 value area. Regarding the time cycles, our final in front of us is February 5th (red vertical line). The most telling signs of an impending reversal is the massive increase in the traded volume on hourly, 8-hour, 12-hour and the daily charts. Whenever you see falling prices and then increased volume, you will often see reversals in the trend coming.
All markets have been affected by the confluence of the dangerous moon cycle that ended on the 31st of January and the majority of many markets have made the beginnings of their corrective move. Bitcoin response has been lagging compared to the rest of the markets. The true end of this bear cycle is ending in both time and price in 3 days, on February 5th. Again, February 5th is where many market lows and highs are made according to Gann. Our lowest downside risk remains between the $6,000 – $7,000 value area. February 5th is the end of this 49-day cycle and the end of this ‘death zone’. Any close below $5,000 would signal a true panic cycle has occurred.