hey everyone and thanks for jumping back into the cryptoverse today we're going to talk about ethereum almost home if you guys like the content make sure you subscribe to the channel give the video a thumbs up and also check out the sale on into the cryptoverse premium at intothe crypto.com let's go ahead and jump in so ethereum is continuing to make this move into its lower log rythmic aggression trend line one of the things we've discussed before is how this normally plays out is you have sort of your initial Wick into it with a very
brief period of relief and then as investors kind of accept what's happening then ethereum goes deeper into the regression band the same thing happened uh in in 2019 too where you had sort of a wick down um into these levels and the market tried to hold on but then eventually eth just fell deeper into the aggression band and of course the same thing in 2016 right you had um and actually 2016 looks a little bit closer to today than what the last cycle did you you first had a wick down and then it moved back
up and then it slowly went deeper into the uh the regression B and so what we've talked about a lot before is how it how this relates to e Bitcoin how it relates to all Bitcoin Pairs and this is why for so many you know for so many years I have been so bullish on bitcoin dominance because I know what happened last cycle that allowed Bitcoin dominance to finally top and it was a change in monetary policy by the fed the shift from away from quantitative EAS away from quantitative tightening to quantitative easing now I
don't know if when the FED ends QT they probably aren't going to immediately start QE if what Powell says is true he says they won't start QE until rates are back at at zero um we'll see if they mean that or not but one of the things I I really want to draw your attention to is the process that played out last cycle through the lens of monetary policy this breakdown is obviously painful if you're holding a lot of eth but you know how we've been talking a long time about eth Bitcoin and how the
most likely direction for eth Bitcoin is down until monetary policy changes this was that dilemma that investors had is a lot of people didn't want to see eth break support they didn't want to see it happen but they also didn't want eth Bitcoin to keep going down the problem is that for eth Bitcoin to bottom you probably need a change in monetary policy but in order to have change in monetary policy you have to have pain welcome to the pain this is the pain that you ultimately need remember last last cycle eth Bitcoin bottomed after
ethusd broke support these support levels eventually broke and then after eth broke support and fell into the regression ban then eth Bitcoin finally bottomed because then the FED ended quantitative tightening right you see the purple line right here that's where the the FED ended QT that's where eth Bitcoin bought us and occurred after ethusd fell below the support level this whole thing has been basically a 10x move in in in the price of ethereum everything that happened last cycle is basically happening this cycle it's just taking place on a longer time frame for instance if
you look at at the higher low structure last cycle and compare it to this cycle the main price that eth had to break below last cycle to really go into the regression ban was around $200 this time it's around $2,000 right it's basically just a 10x move furthermore the first low last cycle was around 80 this cycle was around 800 if you go down to that Wick down there it was in the 800s the next low was around 100 and then this this cycle was around a th000 the next low was around 150 this cycle
was around 1,500 so a lot of what has happened this cycle has just been a 10x of the cycle before the reason why people are having a hard time navigating this cycle and why it feels so different is because monetary policy never changed this cycle in the last cycle we saw a change in monetary policy in the prehab year we're now in the post having year and we still haven't seen a change to you know to the quantitative tightening we've seen them taper it a little bit right they've slowed it down but they never actually
stopped it and so you you could have argued actually that maybe had the FED not tapered back over here perhaps that's when eth would have just broken down back then but they kicked the can down the road it allowed eth to go back up to this level this 4K level one more time and then now it's going deeper into the regression man and one of the things that we've talked a lot about is if it plays out like that 2016 cycle you know it's that last tag you know it's that final lower low kind of
that gets you into that regression band and then maybe things can finally start to change it it certainly seems like this time is different and I see that sentiment a lot but if you go to the advanced decline index it it really does show you why it feels different last cycle the advanced decline index of the top 100 cryptocurrencies was trending up starting at the end of the prehab year but it was because we had seen seen a shift in monetary policy this cycle the ADI of the top 100 cryptocurrencies never actually stopped going down
so this cycle we're still in this process the the the process that comes before the pivot away from quantitative tightening and you can see back then that the ADI just continued to drop I'll scroll down in case you want to pause the video and read the description and the usage but this is the process and this has been hard explaining to people that this was always the most likely outcome the one thing to consider here for ethereum is that when ethusd broke into the regression band right here right as it broke down into the regression
band that is precisely when all Bitcoin pairs took the plunge to the range lows maybe a little bit before but that's around the time where all Bitcoin pairs took that final plunge the range lows so I continue to think that that is the most likely out come there's obviously been a lot of things that we we've talked about that would likely happen and a lot of those things can become memes if they don't happen quickly enough but as always business Cycles take years to play out one of the things that really became a meme was
the idea of eth ever going home now that it's going home doesn't really matter that we spent years talking about it it doesn't necessarily change the pain I think people can like mentally think like oh yeah like this is actually exactly what happened last cycle but but deep down you know I think people were actually hoping that it it wouldn't actually have to repeat and that the monetary policy view would not be valid turns out it was it was always valid um so just like it has taken a long time for eth to finally break
support and go home it's also taken a long time for all Bitcoin pairs to break and go to the range lows and I still think that is going to happen just because it hasn't happened doesn't mean it won't and I think that's the thing that has been very difficult is that any time you know we we talk about these theories and whatnot just because they don't immediately happen doesn't mean they're not going to being directionally correct is more important and all Bitcoin pairs have been trending down since 2021 suggesting this is all part of the
same cycle as crazy as that sounds like the the devaluation of all Bitcoin pairs today is part of the same cycle that began the de the devaluation of all Bitcoin pairs back in 2021 again I get that that's a hard narrative to buy but the chart shows you that all Bitcoin pairs are oscillators at best and therefore they will likely go to the range lows eventually meaning that all Bitcoin pairs should drop another 35% altcoins against Bitcoin now if the FED changes monetary policy and they still haven't gone to the range lows I might be
willing to change my mind all that on that but if I'm being honest with you if the FED were to Pivot before all Bitcoin pairs go to the range lows you might see all Bitcoin pairs rally but I think that the FED would likely have to reverse course on their monetary policy and still you would eventually see all Bitcoin pairs go down there so I'm still operating in the assumption that the most likely outcome for all Bitcoin pairs is to go to the range lows and I think that ethereum finally going home will allow that
now technically quote unquote home for ethereum is right around $1,500 to $1,600 okay technically I it's right around 15 to 1600 the dollar amount changes basically every day because it's a function of it operates as a function of time but around $1,500 to $1600 the lower part of the regression ban is all the way down at around $11,000 right around 1,000 now what's interesting is that for ethereum last cycle you basically had you know a macro higher low right remember that 10x change this low down there was around 120 which is why I've also suggested
that you know it's possible that ethereum could eventually go down to $1,200 but if it does go down there it might not happen immediately it could be a process if it were to happen immediately I think that would actually be um an easier Market to navigate because actually what happened in 2019 was it it didn't go down there immediately e first fell into the regression band down to about 160 so if you're thinking about that 10x move that would put it around 1600 then quantitative tightening ended ethereum rallied from 1600 back up to or sorry
from 160 up to around 220 and then it eventually faded down to the lower part of the regression B so I don't know if it's going to take the same amount of time you know obviously you could argue that since the uh since the uptrend lasted this time a lot longer maybe it takes longer to get deeper into the regression band but I don't even know if it has to play out like that because one of the realities of markets is that the markets generally take the stairs up and the elevator down right it's sort
of a slow process going up and then when the market goes down it can just be a quick capitulation so one of the things that I've learned about it is it you know explain focusing on explaining what process has to occur I think is much more useful that way it's not about when it happens it's just saying Hey whenever this does happen then the next part of the process can play out right so for instance like eth Bitcoin the idea of of when does it bottom well we know last cycle it didn't bottom until the
fed pivoted from quantitative tight away from quantitative tightening that didn't happen happened until after ethusd broke down which that's what's happening right now now back then when ethusd did break down right when it did break down how many weeks did it take exactly I guess you could argue it took about 3 to four weeks about a month or so this breakdown by ethusd really started about late February so the argument could be that maybe another week or two which is interesting because that's when the fed's next meeting is going to be is next week so
you know if eth goes to that $1,500 to $1,600 Mark and then the FED pivots away from quantitative tightening if it follows last cycle then you might actually see a rally by ethereum on the other side of March options expiration back above 2000 um I think the tough part is the tough part really deciphering is you know will ethereum you know assuming it does go home you know more fully I mean you could already it's kind of already there to be completely honest but you know if it were to go to like, 1500 to 1600
does it make a deeper move into the regression band right does it go all the way down to around a thousand like it did last cycle and like it did the cycle before that and and that's kind of the harder part if if ethereum doesn't go down to the lower part of the regression band soon then my guess is that on the other side of March options expiration especially as you get on to April there would be some form of a counter Trend rally uh even like maybe how you had in 2019 the other thing
that's kind of hard to decipher is that I know a lot of people want the FED in quantitative tightening and they very well could in March but if you read the most recent fomc minutes sort of the median forecast is that they won't end quantitative tightening until the summer about mid year so you know a lot of it just kind of depends on on how long they want to draw this thing out um pain in the markets is is ultimately what is needed to durably get inflation under control you know you can't really solve the
inflation problem in a durable manner without having pain in the markets and so I do think there's some level of recognition that everyone needs to have that like in order to get to where a lot of people want the markets to be ethereum has to go where they don't want it to go it was just like in 2019 I mean like I I definitely in 2019 would have preferred that ethereum had just gone straight up but it didn't right there had to be pain first ethereum had to go down into its macro higher low and
and then ultimately we got that rally right there now we did get a recession that sort of threw things off course for a little while but that's the process of the cycle right and I'm just trying to take this thing you know one week one month at a time um to try to talk about you know what are these these most likely outcomes so the other thing that I I want people to be aware of with ethereum is if you look at the risk level for ethereum uh one of the things you'll notice is that
in 2016 and in 2019 eth ultimately fell to the. 3 to point4 risk ban that's where it fell in late 2016 when ethereum went home in late 2019 when ethereum went home it fell to the. 3 to point4 wristband and we're basically knocking on that door because you can see the ethereum risk right now is4 so if this truly does fall into that. 3 to point4 wristband for a few weeks and you see ethereum deeper into the logarithmic agression trend line I know it's it's it's going to be easy to to say that this time
is different and and everything um but my guess is that if it does lead to an end of quantitative tightening then that could actually finally allow eth Bitcoin to more convincingly B and I think that's the hard part is that you know until that pivot in monetary policy occurs it's always possible for eth Bitcoin to you know to ultimately go lower um but when ethusd broke down last cycle it was right around here for E Bitcoin so it had a little bit further to drop but not much so I think we're getting close in order
for it to be more convincing eth I think needs to go a little deeper into the aggression band but ultimately you need to see that pivot by the Federal Reserve away from quantitative tightening I hope these videos on ethereum for the last few years have been useful you guys I know I've been criticized a lot for being too bearish on eth uh but ultimately this is the process that I I ultimately thought needed to play out eth Bitcoin going into this capitulation and ethusd going home and until ethusd made the move home eth Bitcoin was
going to struggle in order for eth Bitcoin to go back up ethusd has to go home that's at least my interpretation the last thing I I want to mention and then I'm have to run is if you look at at us interest rates minus the 2-year yield uh the one thing that we've previously talked about is that this cycle looks like two prior Cycles the financial crisis and also 1989 to 1990 obviously it would be detrimental if it's the financial crisis on repeat so if we try to remain optimistic and say well what if it's
not that well what if it's this what if it's 1989 to 1990 by the S&P 500 if it's 1989 to 1990 then you basically have uh this move by the S&P where you had you know a a triple top followed by a lower low in the markets right you see that by the S&P and I've talked a lot about that as it relates to ethereum because if you take right if you let's switch this over it's on a l scale right so if you take a bar pattern here if you take a bar pattern here
and we copy that we copy this here and then we overlay it with ethereum this cycle it doesn't look that different right I mean it really doesn't I know it it feel it can feel different but you know there's there's definitely you know a lot of similarities in in sort of these moves by the market where ethereum you know eventually goes into that final that final lower low uh and that lower low corres responds to the recession and if you overlay the logarithmic regression trend line for ethereum you can see exactly what I'm talking about
right I mean this and it could certainly go deeper in there I mean it could go you know it could it could look something like that where you have you know you have your your triple top and then your final drop is just this outright capitulation and then eventually you you get a move back out of it but this is actually something that you could have learned just by looking at interest rates minus the two-year yield back in 1989 to 1990 I wasn't looking at the S&P and trying to figure out where does it look
like eth I was looking at monetary policy and interest rates and I just saw there was a similar time in the 1980s 1990s that match today and then when I looked at that fractal it looked a lot like ethereum the one last thing that I want to mention uh is if you look at the S&P divided M2 this is actually the same level that it got rejected at right here in 19 1998 and this was actually this ended up being a 20% drop and there was another massive rally after it but that's ultimately where the
S&P divided M2 topped in 1998 but anyways guys we're going to go ahead and wrap it up there ethereum is nearly to that main area in the logarithmic regression trend line so it's almost there um hopefully we can make you know hopefully we can ultimately make it there and see pivots by the fed and and E Bitcoin bottom out but those are my views thank you guys for tuning in again make sure you subscribe give the video a thumbs up and again check out the sale on into the cryptoverse premium at intothe cryptoverse doccom I'll
see you guys next time bye
