$BTC #Bitcoin Long Form Interview - Bob Loukas
hello hello hello everybody it's big chad i'm really happy to be coming to you live here so monday march 7th 2022. just want to make sure everybody can hear me okay if you'll just give me a shout out there in the chat room we'll make sure everything is going okay once again folks let me know where you're coming from in the world it's a worldwide phenomenon i love doing these videos i get to reach out and see we have folks from all over the world southern patagonia uh people from india people all over the place that's what we're doing what's up hello from switzerland arizona folks really happy to have you here we also have a lot of folks from the bitcoin live community that's our family i really want to say a deep heartfelt thank you to each of you for coming as well this is part of the long form interview series um i started this uh you know a few months ago and i like having the opportunity to bring on some really smart minds some people who know this space and maybe know the space better than i do or know different things about the space and um i'd like to have this kind of unscripted and open um you know honest conversation with those folks and that's what it's all about and continuing that tradition tradition of great guests we have bob lucas today bob is just an unbelievable trader market uh analyst and uh so we'll go i'll let him kind of explain to you a little bit more later about what he does but if you go to his twitter page you click on that link here looks like there's kind of a master link to a lot of stuff he does he's doing a lot of different things um he's also on youtube if you go to bob lucas he's got that the uh four year cycle and uh four years you know four year journey uh some great videos that have been really well received by the field so i'll encourage you to check that out i'll also put links um in the video description as well everybody says okay sounds perfect excellent i appreciate that i appreciate hey folks i appreciate all that positive feedback in the chat room it's unlikely i'll be able to see all your messages and reply to them i'm not ignoring you i want you to know i see them and i definitely appreciate that just as a quick reminder i am on twitter at big chats academic observations about price trading psychology risk management of course you can find me on youtube uh please do go ahead and check out uh please do hit like and subscribe if you're just getting started go to the tutorials playlist i have some great tutorials i've done for you to kind of introduce the chart basics that will really help you understand everything else i'm doing when you're ready to kind of graduate from there check out the quick market updates and of course these are the long form interviews really have a wonderful um group of them and i'm really excited for today's guest of course as i just said um as a reminder i am the um i am the author of trading wisdom 50 lessons every trader should know it's available on amazon feedback's been unbelievable i really appreciate that if you can't afford the book or you know you just don't want to buy it totally understand free version on my youtube i have 12 of 50 lessons eventually i will have the whole the book out there for you for free and of course i'm a founding analyst at bitcoin live the best in class educational platform for crypto something i'm incredibly proud of we have a wonderful team and look at that bob lucas is part of that team so we're gonna get right into that um i'll give you about two minutes here in bitcoin and then i really want to hear from our guest i continue to maintain we're in a risk off environment certainly below that key level that 40k level and you want to think about when you have a bottoming pattern that tries to form when it fails that's a warning sign we had that with the failed head and shoulders here the invalidation of the right shoulder we had to bounce right into that supply right where the price is rejecting here at 46k right that's the key level i'm not going to go into this too much but i did do a live stream earlier this week um actually that was about five or six days ago definitely check it out i really kind of get into detail about how we got here i will just say quickly we're in a environment where support support is not well defined but resistance is and you want to structure your trades based on the most clearly defined levels so we need to get above 46k to have any kind of bullish momentum in the meantime we're looking for a spring which is where you have a low you violate it and you recapture it we did that here january 24th we did that here february 24th we're heading back towards those lows it's a little bit of a risky environment so you know for now this support is not well defined i think you have to wait uh for a spring but you didn't really come here to talk to me came here to listen to my good man bob lucas how are you doing big chance how's it going i'm i'm doing really well i'm really happy to hear your voice thank you guys is there a little echo in this room it's minimal okay so bob why don't you tell us a little bit and and first of all thank you i really appreciate you taking the time um you know tell us a little bit how you got into these markets and um really how people can can learn more about you actually first you know i showed some links but if you know about that i only came here to see you dance i didn't i didn't realize we're gonna talk about things as well right right well dance class first and then chart class later all right sorry the moves can can use a little bit of work but they're not too bad you're right you're not wrong there all right i mean where do you start um how far back do you want to go um i mean like i'll be 50 this year and you know the term it goes by quickly is probably the truest truest thing i've heard in my life you know it seems like yesterday that i was i guess a teenager late teenager a lot like probably many of your listeners not necessarily teenagers but perhaps in their 20s and you know com was was the rage at that point and everything was exciting and everything was speculative the whole world was changing and i don't think it's very different to to what we're going through today in crypto and how attractive those markets were so certainly um as a young guy who you know would like to place a bet so to speak you know i i didn't mind going to the casino or even the track as a young guy and first to admit that the attraction really was from the beginning just the excitement of it all the thrill that you get on the trade it really is the same thing as placing a bet i think for a lot of people so it was a natural move into into trading in the markets and you know i think i paid for a lot of my tuition at that time and i think i like a lot of people in 2017 i you know the equivalent i made a lot of money as as a pretty young guy and lost all of it and uh had margin debt and credit card debt as a result so yeah i definitely um had a good time but uh walked out of that experience thinking geez what the hell happened you know that was quick um you know but i think it's just been an evolution since since then it's just a been a process of uh getting deeper and and learning as you go along learning from your mistakes and then just finding sort of strategies and techniques that resonate more with you as a trader and starting to pick up on them and really start to follow and develop those disciplines is kind of the progression i think it's a natural progression for everybody you know and a path that most needs to follow i think to become successful but the key question is how much time does it take you know are you making these mistakes consistently and continuously or you're learning from them because the the evolution to to successful trading and investing has to follow i think some form of that and uh so the the key is not necessarily to uh you know to to lose you know lose confidence it's really just to realize that hey you know i learned from that that was that was a lesson the key is not to suffer at least not you know as much as possible not to suffer the same type of mistakes two three or four times um yeah so go ahead i mean well that's interesting and thank you for sharing that and i think you um really well describe the journey a lot of people go through as they approach it as a hobby and casually and from that thrill and um and we get wrecked a few times and um so i think i think it's uh helpful to heal hear from someone like you who's kind of climbed the hill or some hills at least uh that you went through that um you know i wonder what were some of those earlier things that you really found yourself uh repeating over and over again and you really couldn't figure out why you were doing them or you know what were the some of the really big early problems that you that you found in your own trading journey that you've now overcome well i mean it's really every facet of trading right from from identification of an opportunity or an idea from executing that idea from sizing an idea to managing an idea once in the position and then the psychology of all that sort of wrapped around so i think you make mistakes across the board and you will continue to make mistakes i think until you the day you hang up you know hang them up and and and decide to walk away there is no such thing as you know being mistake proof it's just a matter of minimizing as much as possible um you know but i think the biggest lessons overall have been and i think you've been getting a lot more into this lately from what i can tell it's really around the psychology of trading and the understanding of self and the role that you play in the overall outcome of your success um you know i do meet a lot of people that have some phenomenal ideas and some great charts but i think when you uncover it they still struggle because they they're right often but the result is not right because it's not just about say for example the identification something it's it's it's everything that's one component of it only um so i think the biggest piece i think for me has been getting to kind of a spiritual awareness not to sound too zen-like but getting to a point where uh it's almost again it's almost like in the matrix where you know he kind of like finally figures it out you know and everything just because just slows down it's kind of getting to the point where everything can slow down and you kind of remove yourself from the thrill on the action as much as possible and you start making a lot of the decisions um you know kind of with that in mind and just just the visual and the clarity that you get from from that approach so how do you maintain that level i mean you're talking about um you know a level of performance that you can't just you know step into um you've built up to a point where you're able to be aware of yourself and how do you kind of maintain that right is it is it uh discipline with with healthy diet is it continuing to study and read textbooks you know what is it how do you kind of stay in that that mode bob it's it's really two things one is the the gambler's addiction to trading and i think most people are not honest with themselves in realizing that they have a problem and i speak bluntly and i think you know this already yeah i i say it the way i see it because i've been through it uh i think you know i i would say more than half easily of the people who trade are really in it because of the thrill and it's an addiction and some of them will do well some who are who are very just have a very uh natural talent at spotting and picking the right uh you know the right charts the right ideas could but but they're very very few percent of the overall group so the very first thing is transitioning from the addict to the professional and you know this this isn't a joke it's uh yeah you're dealing with hard-earned capital that you've worked for or your family's worked for and i think a lot of people take the attitude of well you know screw it you know i got to be that to win it kind of thing and that's really a gambler's attitude it's it's just it's just throwing you know throwing stuff against the wall and hoping they kind of stick without really having a strategy behind it so i think it's getting through to that point where you start to say you know i've got to be serious about this you know otherwise i might as well put this in a long-term index fund and it should do relatively well right uh because that will outperform most of the of the people who call themselves traders so i think you just have to be have to be honest you just have to get to the point and say yeah i'm doing this for the wrong reasons or i have the right intentions but i'm not acting with those right intentions in mind you know i i'm really doing this for the thrill um and then you know you touched on other things uh yeah i think your personal self in terms of um you know health like you said and and spirituality i think those are important but i don't think they necessarily are the game changer i think the biggest one is the transition to treating this like a profession and realizing that there are some really hot sharp teams and groups out there who just eat you alive and um and they are for the most part so i think you have to get to that point as much as possible and then you have to start focusing in on what it is you're good at you know what parts of the market do you see uh and well and what don't you see well and avoid everything you don't have to be in everything right you don't have to bet on everything it's like it's like the guy at the casino who's at a blackjack table and the deal is shuffling the cards and there's a three-minute pause in the shuffle and they have to get up and run to a roulette table a place like that you know right it's kind of that attitude that traders uh would take so they have to always be on something and doing something and those are very low quality bets without a strategy without a plan and they will wreck somebody so again you just have to get to the point where you're professional you have a goal you have a strategy you identify what works best for you and what works best for you is not what works best for me and there are many elements that just don't work well for me and i've learned to for the most part at least that again nobody's perfect but i've learned to kind of just avoid that as much as possible and stay in my lane and and work with what i think i have somewhat of an edge on yeah leave me and really thank you for that um you know that leads me into my next question and you talked about you know the need to feel to be in something all the time and i think that's a great analogy you're waiting for the black deck dealer to shuffle and you want to run over and you know play this slot um i understand you you follow and watch many markets i know definitely medals i've seen all your tweets about gold and perhaps we can talk about metals in a little bit later how are you choosing you know with kind of an understanding of of all those different markets how are you choosing really what market to play um i'd be interested to hear about that again it goes down to what works best and you know with my strategy in trading cycles i've just followed different asset classes throughout the years and certain asset classes respond well to that cycle theory and some don't and i've just learned through trial and error and through losses and you know through that process to avoid certain markets and to trade certain markets that work well for me and that goes again towards the idea of trading what you know best certain markets behave with certain characteristics that different people can see differently um i know we hear many good traders say this that they trade a certain asset or a certain uh certain symbol really well and others they can't or they're direct because it just doesn't it's just a disconnect right and there are certain assets like gold i personally feel as if i could almost feel the tape in in many ways sometimes you know so i could feel the movement and like i've seen the patterns evolve over the years and i feel like i have an edge all right i'm not again nobody's perfect but there's an edge there and so i try to gravitate more towards where there's a net where i think there's an edge i think it makes a lot of sense and i think that speaks to what i've talked about um you know you play you want to you know play what you know and you get that muscle memory and so it's it's good to hear that you have that kind of muscle memory with gold and it should you know the newer tray and other things i assume but it should let newer traders know that if you do put in enough time you'll uh and focus on something you'll improve your edge on that um you know so i'm interested to hear we haven't got that yet but how did you get into crypto if you don't mind just giving us or how you you know what was your experience learning about crypto uh well let me think you know i have a tech background i did quite a few years uh in fintech okay um so i i did a computer science degree back in uh i guess the early 90s okay so you know i've always tinkered and developed at least back in the days not so much anymore so there was a natural kind of um understanding i guess even though to be honest with you i was quite a bit skeptical in the beginning of bitcoin i kind of thought it was just a ponzi uh in 2013 14. it wasn't until sort of 15 that i thought this is great and kind of missed the bottom there and didn't really get in until 16. um so yeah again i just and then also i have this sort of libertarian gold kind of uh streak in me i'm not a die-hard by any means but you know i do have i think some sort of libertarian leanings which i think the sort of self-sovereign aspect of of bitcoin uh the decentralization decentralized aspects of bitcoin really are attractive to me so i like those and i'm a firm believer in it and um you know the technology and and what it can mean to us as a society as a humanity uh so i definitely you know definitely find it exciting i i love tinkering you know i build nodes on my with myself i love to steak and i love to to play around with uh some of the old technologies that are out there so i think it's just something i enjoy doing yeah i want to ask you are you still mining um you know what are you doing with that you said building nodes you're mining is that right no i was mining ethereum back in the days on the gpu but nothing in terms of mining just just just the node a bitcoin bitcoin nodes using the raspberry pi kind of devices and then sort of staking ethereum um things like that so um and just but you know towards the end if you don't are you able to share screen later i'd love to hear you kind of just walk us a little bit through the the price action i know i didn't ask you ahead of time but just to um prepare you for that if possible later i could probably do it so um are you i've enjoyed watching your tweets about you know following your tweets on nfts i know you've kind of um had a little bit of a journey there you want to kind of you know tell us some of your thoughts and what where you think we are maybe where we're going with that oh i mean nfts are very deep and on the surface they don't seem deep but you know we're in iteration one of nfcs and i'm excited by a lot of what's out there but at the same time like a lot of things in crypto or any real innovation there's a lot of speculation there and right now it's kind of reached or has reached or about to reach kind of that fever peak in many ways uh there's obviously a significant amount of junk out there designed to trade like tokens they're really just tokens uh a lot of them are okay there's there's obviously utility based nfts which you know have have value in the utility itself and then there's uh pure art sort of based entities which have value uh which is a lot more subjective but then there's a lot of junk out there which is just another form of icos and training tokens as far as i'm concerned so you know i think this market's going to go through a washout in general um and quality will remain at the end of that and there will be you know with the with with smart contracts continuously evolving and you know adding utility with nfcs i you know it's exciting to see possibly where this goes in the future um so i've been i've been feeling around with them i didn't get in early but some didn't anywhere near getting late that's for sure um so it's been a good experience again it's mostly just like to get involved and like to understand if i'm going to invest in something and i use the word invest a little lightly here if i'm going to trade in something right i kind of want to know what it's about um certainly won't be an expert in it but i want to know uh the players involved their motivations the technology the capabilities and i think that gives me a chance at least to to make some informed decisions on where put my capital but and some of it was speculative as well some of it was uh you know again going back to sort of that gamblers thing that's not something that ever goes away so there's always you know even for me now at 50 kind of there's always this uh fluctuation over time where i just feel like i need to kind of get a little speculative and a little bit here and there but again it's with a very small amount of funds overall um you know there's really no risk of being hurt personally doing it when you're looking to speculate what are you doing are you doing all coins are you trying to you know buy low sell high in some of these nfts what are you doing there when you're speculating basically what you just said yeah yeah you know it's just you you're finding it i mean the good thing about well the thing with nfts is it's such a human driven market because it's so social you know it's so driven by by people and sentiment discord groups and yeah and and influencers as well unfortunately um you know so it does involve a lot of time and that's the reason why i've kind of pulled back quite a bit the last three or four months it's just it's just taken too much time to to really play that game um but yeah i've kept a couple of entities i like that i think i want to hold more for the longer term and just involved here and there for the most part but just really just paying attention from the sidelines a little bit more now just to see where this all goes i think that'd be a good segue on into some of the market analysis i'd love for you to maybe you know for people who aren't familiar talk a little bit about what cycle theory is um and then maybe if you don't mind um you know show us your chart and maybe how you know talk a little bit how we got here the last two or three months at bitcoin and then kind of where you think we are now um like that okay uh how do i share my screen on this let's see middle uh middle next to settings there's a gear on the bottom there bottom middle oh we'll see all right tell me when you see my screen okay to the stream my friend all right thank you sir all right so what do you want to know first you want to talk markets you want to talk cycles yeah why don't you if you don't mind just give us an intro to kind of cycles and then you know last three months of bitcoin kind of how we got here yeah i mean the idea of cycles really is tracking price action which is tracking sentiment around an asset class in general um you know cyclones are just a sequence right it's a sequence of events that repeats and we find that most asset classes or all asset classes have these repeatable cycles from trough to peak to trough and this really forms over time in any asset class it's really just the ecosystem evolving and as people join they kind of join that ecosystem and they they form this culture and you know price action just represents human sentiment right uh how many people want to buy it or sell at any given time and if obviously if more people wouldn't want to be buying at a certain time and sentiment is running uh positive and bullish then in general you'll see price action or price move to the upside and then the same in reverse in a decline you'll start to see more sellers fuel buyers willing to step in at certain prices and you'll start to see declines so these cycles simply just represent the the collective participants in any market so these arrows simply represent the cycles there are cycles on various time frames so there'll be a cycle as some of your listeners will probably know on the sort of the four year time frame which is this long secular cycle that is more driven by longer term capital longer-term long-term focused investors but then within that you'll see other cycles like a nine month cycle or a 60 day cycle and those are shorter obviously in duration and and shorter in time frames um so these these green arrows represent the low of a cycle in the 60 day time frame and then the red represents the top of the cycle so you'll see in a rising market the top of the cycle occurs pretty far into the cycle not too far from the low and we call this a right translated cycle simply because there is more time in the cycle where it's rising and fewer less time declining and you'll see almost all trends to the upside we'll have these right translated cycles and you'll see this back obviously in 2020 when we ran up so you have you know kind of like eight nine weeks to the upside one or two weeks down same thing here seven eight and then couple down in a left translated or a declining structure like we've seen here more recently what ends up happening is when the low forms the market struggles to bounce up and that's simply a reflection of sentiment far more sellers willing to come in and take a lower price to get out of the market or to push or sell and fewer mark a fewer buyers willing to come in so what ends up happening is out of a low so there's some selling some capitulation the rally or the move out of that cycle low is is fairly sort of subdued as you can see and then the market spent more time rolling over so you'll see that all the way through you know in a declining phase again fewer weeks rising more weeks declining and that's how you get the decline in the in in the cycle so what we try and do in cycle theory is we try to understand where the market's trending where sentiment lies and once we know where the trend is going we tend to see multiple cycles kind of repeat and look very similar so once you start to see a trend evolve and you start to see right translated cycles there's a pretty good chance that that trend will continue we'll start to stay above the moving average and will start to rise so the the idea is then to obviously buy as close as possible to a cycle low and then when the market gets stretched you know you can look at a bollinger band so you ride the upper bollinger bands and then when you start to really peak above that and you're in the timing band for a cycle high then you can start to possibly look to trim or exit and repeat the process and the same kind of same thing coming down right but just the opposite you're looking more on the short side and you see the same process where we start to move below the moving averages we start hit lower bollinger bands and then when you start to take out some of those lower bollinger bands in the timing band there's a good chance the market's gonna start to jump in a new cycle but because you're in a downtrend then you start to think well the last two cycles are in a downtrend there's a very good chance the next one will also continue in that manner so the kind of segue into where the market is right now again um nobody nobody ever knows with any uh significant accuracy where the markets are going right we try and identify possibilities that make a lot of sense and we formulate strategies around those possibilities and then we are quick to acknowledge that the primary possibility that we thought had the most chance is is not unfolding and we quickly have a plan for that to reverse our actions but the way it stands right now simply and unfortunately we're in this downtrend since the highest back here in november which was a double top um you know i think many of you know that i was thinking that we'll come up here and we'll shoot up and go up towards 100 to 200 000. we haven't done that obviously and
now we've we're now we're locked in this declining structure so we're declining uh we haven't taken out the january lows just yet but we're kind of getting deep in this cycle here's a daily chart and this is the daily chart of the 60-day cycle so we formed this lower back here in january we spent 18 days coming up to a high then we came down into what we call the mid-cycle point so this is around the 30 day mark in the middle the middle of this low to the expected next low typically into the mid low you get low you get a bounce and this is where there was a couple of paths that the market could have taken it could have gone up and made a higher high yeah which would have been a right translated cycle and that would have been a fairly bullish development or at least an indication that the decline from the november highs was over right but we didn't get that right we fell short right there and we came back down and this is what i was looking at this was the fear that we wouldn't uh that we didn't come up and we've broken down and now really just just being honest with the trend and just following the trend you have to with you'd have to think that at some point would lose these mid-cycle low area so this sort of 36 000 area continue down to test the 34 000 range which was the cycle low break below that and then when you kind of zoom out then you look well let's go to the weekly then you start to look at this level here at the 30 000 28 to 32 000 area which has been the bottom of a number of cycles and then you hope that that provides the necessary support to form the cycle low in march and we can bounce out of that and then if we bounce out of that again we hope we don't roll over one more time in the next cycle and continue to trend lower we hope that that forms enough support where we stay in this range at least for now and hopefully make a move back up towards the top of that range and then from then we can start to maybe get a little more hopeful to think that possibly we can break to the upside and go to all-time highs but that's just you know that's too far too far ahead in the future right now to worry about that we have to worry about what we have in front of us and again like i said this is kind of the primary view the bullish view now is that we can kind of stay sideways and hold this 34 000 kind of level um and come into maybe just grind sideways for the most part and completely decouple from a declining equity market form a cycle low in this march time frame maybe something similar to what we saw back here in july right where you know we can't just you know we we made a lower low of course but it just barely and hold that level and then just shut up quickly and within kind of uh you know 60 days at the top of the range again so we're hoping that kind of form right here um so this is where we're at right now definitely in a defensive position yeah i think anything below this 46 000 level right here is defense only yeah i don't see a need to to to get to getting any real fomo with any sort of two three four five thousand dollar move at this point i think that's just counter trending to the intermediate decline that we're seeing and i think those opportunities and that's what as i was saying to to members of bitcoin live when we came back up here to 44 that's the time to start to say how are you positioned are you leveraged are you overexposed because that's a good place to possibly trim or get back into a more balanced position where you can sleep comfortably at night because it's a chance we do roll over into the lower levels and you don't want the market forcing you to make decisions at the wrong time you want to make your decisions when uh at least they're more favorable to you so this is really you know it's unfortunate but that's just the reality we have to be honest with right reality in the production and this is where it's pointing to right now so again hopefully the blue path unfolds but even even the red path if we can get a flush out down and maybe get and make a new low take out the july lows take out the january 21 lows and kind of v-shape out of that it may not be the worst outcome after all if we can if you can survive through that and obviously not capitulate at that bottom but you need to be sized correctly here to avoid having to be forced to make decisions like that in the future so are you just continuing to to to kind of add to your huddle dca or did you make it you have to discuss this if you don't want but did you make a decision kind of you know november you know when it started to break down that you kind of trimmed any long-term positions how are you handling that kind of what we're doing mostly underweight across the board um and there really isn't any adding to be done here as far as i'm concerned yeah we need to get back above 46 to look at the cycles and and say to ourselves what's going on um that's really out of character and then uh looked at above this sort of 47 000 level otherwise yeah uh really looking for this march time frame cycle lower around march 20 to 24th before possibly going back to sort of a core position or maybe even an overweight position um and that's gonna be it's going to really be dictated by how the market uh really unfolds in this level but even even a big move down to say you know 26 to take out all those prior support levels and prior cycle lows if we can form a low and then reverse and it's clear that the cycle lowers in it could be an opportunity to kind of get back into a pretty sizable position because then that low forms a stopping point right so if we come down from a low and then shoot up at least you have a level where you can kind of put your defenses in and get back out go back to underweight or go back to a neutral even a short position overall and this is where i use cycles predominantly is to is these lows are kind of like checkpoints okay and they're important checkpoints so a lot of the trading decisions are based on on those lows um so if you form a low there and come back up i'd be very inclined to buy that that dip but then respectful of the lows that formed because we shouldn't be taking those out in a rising market in a declining market you're taking out the lows as you can see here's a cycle low and it took it out yeah there's a cycle low haven't taken it out just yet so you don't want to be seeing lows prior cycle lows taken out because that is just the definition of a decline of a downtrend in the cycle in the cycle theory so we want to we want to be um you know out in those cases so i've seen a lot of people talking about uh march and so you know is it is it is it hopefully going to correspond with maybe a settling down of the macro picture is that kind of just um you know i've seen you say that with a lot of confidence it's interesting to me it's like how could one know you know three weeks out but um a lot of smart people are kind of saying a similar thing um is it just because the timing of the cycles or is it also maybe you know a thesis with the macro as well it's mostly just timing of the cycles and you know you have to be honest with them they're not perfect uh once you start believing you know they that your that your strategy is sort of foolproof that you're gonna be in for a lot of trouble um cycles they kind of come in a range there's a timing band they come as early as 50 days 52 days as far as 70 days so you're kind of mixing a little bit with other technical indicators you're looking at um you know sort of the price action do you have a washout for example right and then you're looking for kind of a reversal you're looking for a swing to occur you know so you have to be patient with it but generally markets respect cycles for the most part um certainly in an uptrend they do right so in a rising market they are just extremely uh they're definitely a good tool to have in in sort of the bag in a bear market decline uh the surprises can can really get out of hand at times so you have to be very careful in a declining market but yeah in general they kind of just rhyme on these on these cycles and these are just sentiment driven right you yeah you can overlay a sentiment uh sort of percent chart on this and they they pretty much generally align fairly well um and of course like i said earlier on sentiment price action they're very very much related and correlated so are you looking for like a 90 down volume day that type of thing you know or is it just if it happens that's great but if not you know yeah i mean not all cycles will end that way um like for example this one here i think really had the capitulating nature of that but i think it was more of a re-test and you had that capitulation in the cycle before that right um so i think this was just a case of just uh you know sellers drying up and and the market pushed up and then also the expectation that you would get that decline so there's probably a huge amount of short interest that build up built up they had to cover their positions so no it's not always the case but whenever you do see a significant capitulation in the timing band for a cycle low it adds to sort of that confirmation that you want to see because often a cycle will end that way on on some pretty significant volume but also you know i use twitter a lot uh not so much also for getting the message out on my message but also to get a feel for what people are thinking right i mean i look at the replies a lot and i comment a lot because it actually gives me a read on what people are thinking and uh so i'll use i'll use a lot of sentiments a huge part of of of kind of my thesis in structuring a trade or or my view on what the market's doing i think that's smart i think it's really smart bob before we um this is a quick question from one of the the viewers please ask bob where we can learn more about cycle theory and trading it any easy links or uh jm hearst profit cycles is probably the best book uh what walter brissert as well is uh some resources online you'll have to google uh brazil okay those two are pretty much my main influences um and thank you for for answering that question um just last on bitcoin real quick you mentioned you know in the downtrend we get surprised you know in this type of a corrective environment um is there a level that would really kind of you know freak you out you know i know we've never crossed over the prior all-time high you know so if we broke below 20k would you start to really start to rethink you know a lot of stuff or would it depend how we get there you know can talk about that a little bit yeah it's a good question i mean we we have to be we have to appreciate i mean look at march 2020 yeah we have to appreciate the the volatility that comes with this space you know we keep hearing about volatility is going to come down as institutions come in but we haven't i mean i don't think we've seen that yet if anything we've seen probably um more 30 plus percent declines in the last kind of year maybe than we've seen throughout the last last 10 years or it's up there at least so the volatility is definitely there and and bitcoin is just one of those asset classes if you're not respectful of its possibility and its possibilities are endless really um then you're not going to do well if you don't have a plan for that you're not going to do well in terms of you know there's a certain price level impact so the viability of bitcoin i don't think so okay i don't think so i think it's on a trajectory personally um and i think that trajectory over time is is up but again the path to get there and um you know the four year cycle is a classic example of that we looked at prior cycles and the four-year cycles and were we we had a reasonable path laid out towards a certain level and you know we got rejected back up here in november so we have to adapt and that happens in investing and trading happens in every asset class it doesn't always work out the way you think it's going to work out even if you're very confident there's always a possibility that it won't go the way you expect and you just have to make sure that the bias that you carry is not one that's going to handicap you from making decisions that when you need to make them and you know i think that's very important all right i think it makes a lot of sense i think um so i'm curious um like what's your what's your risk appetite for altcoins right here um and i think i might know the answer but you know what you know how are you approaching all coins given you know what bitcoin's doing here well i mean i'm a trend follower i mean i i i like to i only really trade all coins when the altcoin itself is trending um higher versus bitcoin in general so i want to see our performance to bitcoin right and we haven't seen any of that and bitcoin's been down of course obviously versus usd they're getting slaughtered so now i haven't really placed i mean i think i've maybe done one one or two trades in the last three or four months whereas you know back you know back here in um december uh of 2020 and basically this whole move up you know i was probably doing one or two a week so i think it goes back to do you have to be in the market do you have to be trading and if it's just not right if it doesn't fit kind of my strategy then there's nothing for me to do and i just haven't seen a chart that i like i mean i've i go through around 50 or 60 on my watch list and there's been a couple i mean i think uh luna avax for example i think right some of those names kind of come to mind recently that have probably done okay and there's been some some trades there but otherwise most of them have just been looking sick and um yeah not trending in the right direction uh obviously there are short cannons right there but uh that's a different disc one that i think uh takes a little more experience i don't like to share a lot of um a lot of things on the short side all right um well that's wonderful bob it's just been great to get you here you know to really kind of stretch out some of these ideas um if folks don't know you are founding founding analysts and you're really you are the reason i'm i'm here at bitcoin live so i want to say thank you for that um do you want to really just tell tell us a little bit what your vision was for bitcoin live uh why you started it you know i'm curious to hear a little bit about that uh yeah i've been writing a letter on the fun on the equity side for 10 years now this is the 10th anniversary writing about gold markets equity markets um for a little bit of forex as well um so it was just a natural progression i mean back i think it was in the 2000s i was involved in a lot of online forums sort of before discord obviously um yeah and you know i was very active and contributing a lot and i think a lot of people kind of reached out and said hey you know what do you think about this what do you think about that so i just started putting letters together and most of that was just for my own research just to kind of formulate ideas and you know when you start talking through your ideas you kind of i think get to sort of visualize or crystallize them a little bit better yeah so i was just writing these reports and then i just started sharing them with some people and it kind of just grew very organically and before i knew it had a list of thousands of of people who were receiving this sort of pdf that i was generating built a website and started just doing the same thing just just recording my ideas and just sharing those ideas and i kind of thought well i'm in crypto now i'm in bitcoin it's it's kind of a place where i think there are a lot of new entrants in the market that don't have any prior experience and you know again they're attracted to the gains and and the noise that's coming out of the space and i just felt that it would be something a lot of people would would benefit from or enjoy reading and uh and hopefully it's been a good experience for many of them um it's not for everybody of course but uh yeah it's just it's more of a guide and more of a just a data dump in many ways of just my thought process and and how i approach and view the markets it's really not designed to to make anybody rich right it's not one of those type of uh groups as you know right we're just we're there to basically just share our knowledge as best as possible and hopefully it's designed for people to become self-sufficient and to learn their strategy and to take some of those strategies along with them and format their own plans and and process and and get better for themselves i think it's wonderful um you know i've said it before but definitely want to say thank you for the opportunity yeah i'm just proud of it i think we've got a great a great team so um is there anything you want to leave um our viewers with perhaps some words of encouragement some of the for some of the folks who are struggling um you know anything like that before before you know i'm happy to take some questions i've got a little bit of time if you want all right yeah yeah folks fire off the questions there were some few i'm going to scroll back in the chat room there's a couple of questions with cycles uh so let's see here uh let's see what's going on here folks do someone had asked about folks fire off the questions for bob lucas we're gonna here we go any thoughts on an alt cycle this summer i'm i'm really not the one for all cycles um but in general you know from my experience with say trading precious metals the the more speculative aspect of a market typically doesn't really run until there's more of a confirmable market in the primary asset class or the primary asset in the class so until i think we see a real change in sort of bitcoin's character and we start start looking for a bull market there i don't think you can expect an old season again i've never really taken huge advantage of all seasons it's just again it's just on the fringe too much on the fringe for me yeah but i don't think it would be wise given you know given what we're seeing here to expect an old season in general it doesn't make sense that we would see one well again it's going to depend on kind of how we respond here in march you know does march put in an end to this decline can we then start make a run to the top of the the range if we do that then obviously there'll be some period there where maybe a 10-week 10-week period where all coins go on a good run but i don't have the answer i really don't what i was told bob um we have a question bob let's see how do cycles differ from asset to asset let's say gold versus bitcoin well mostly durations are a little different um different durations and we don't know exactly why the durations are different but you know the the trading of those come from a different sort of group of people different type of people uh in a different era as well so they just evolve over time and they diverge or they don't necessarily diverge but they just have different characteristics of a cycle but in terms of the sentiment element of a cycle it's all the same you see the same move from from pessimism at the trough of a cycle to extreme optimism excessive uh speculation at the top of a cycle and then repeat and rinse and repeat um the key difference you know to understand is that the longer term cycle so you know if you're looking at say for example a four-year cycle so early on as it's rising it's it's more likely that the shorter duration cycles are also going to be uh far more right translated it's not until the market really tops from a longer term standpoint that you start to get more bearish shorter term cycles as well because the shorter term cycles drive um the longer term cycle drives the direction of the short term cycles so you you'll get uh in a bear market that's why you can get worse much more than you think and the bull market um you know you look at some certain markets and you think wow this is just crazy it just can't get any more crazy than this and then boom it just it does right yeah so you get the excesses the extremes um end up end up being far more than you expect so i think cycles again just reflect that so in the bear market you're going to get far more pessimism for longer periods of time so you see a lot of people post sentiment charts and they say oh look it's down to like five percent it's gonna it's gotta bounce but then they're ignoring the fact that are we in a bear or a bull market so in the bull market right when you get these moves down in sentiment that's a good buying opportunity because right normally yeah you normally don't get negative sentiment last for a long period of time in a bull market or a big uptrend or a big move up higher but in the bear market you can get four or five months of really bottom level sentiment and you've got to be careful when you read those indicators so you have to know kind of where the long time frame or the long cycle is uh what about gold there's some question here directly comments on the gold cycle we didn't really and i think would be remiss to not ask you about gold bob what you think's going on here yeah i'll pull up a chart for you so let's look at a week uh weekly of gold so looking very bullish i mean if you zoom out here on gold i'm on a laptop so i don't think you're going to see this that well but obviously this is a pretty well known chart right now going back to the bull market top back over a decade ago down to the bear market and then kind of the early awareness phase and then the move to all-time high it looks like we're completing the handle here in a very big cupboard handle pattern when you sort of zoom in on the weekly here more recently for the move to all-time highs august 2020 we had this left translation here so down into the lows with a double bottom then we came up and we didn't form another low we didn't come back down to test these laws right and we and we formed what's called a time-based cycle there was no price decline meaning that there were just two there was too much buying in here too much accumulation not enough sellers and the market ripped higher and took out the last two highs so in theory here we've now started the new uh a new rally or that's actually not a rally a new uptrend and in theory we're going to start to see right translated cycles that will take to take out the august highs here and then my thinking is that we were in the early phase of a new secular bull market in gold and i think here that over the next two to three or four years that we're heading up for some pretty big numbers the macro kind of lines up well the inflation elements the deficit spending element geopolitical risk elements a lot of sort of macro and the macro is difficult to time i mean if you lead with macro only you're gonna get hurt but when they align like this from a cycle standpoint in the macro i think it makes a lot of sense to me that we're gonna start to see trending higher and higher prices in gold and i think silver's also going to obviously follow along with that so definitely a very bullish picture here on gold it's a little stretched on the short term uh it's it's riding the upper weekly bollinger bands right here but it has it has momentum right here and um you know precious metals commodities when they get momentum they're kind of like all coins when they get momentum they just go and uh i think we're in the early stages of one of those kind of big moves higher for for precious metals would like it what would the target be that would that be kind of the size of that base from like you know 16 to 21 so would it be like 2 600 or something yeah i think i think in the next sort of year or so that's a reasonable target from a a secular perspective so you can probably look at something more towards kind of like the six to eight thousand range um let me take a look here yeah so i think you're kind of looking at prior bull markets and they would do sort of uh you know like a a four to six x from the base um so you know getting up towards sort of that six thousand level uh um i think here i you've already drawn that this is the eight year cycle of of gold so i think we get this move up just like you said here's around 2600 yeah it's sort of my target kind of by next year at some point then i think you get this pullback into what's the eight year cycle low and then i think you get this continuation move up and this is the main the main thrust of uh sort of a sec of the bull market up towards sort of the late decade high and it's really anybody's guess i really don't like throwing up price too much yeah it's more about the time yeah but that's kind of my view here on precious metals certainly position for it um and we'll see how it goes do you have a gold plated toilet you know all that stuff okay i don't know um bob we're quite a question macro i don't know if you not mind answering but um paul who's a viewer asks thoughts on if a recession is coming well i think it's certainly a it's it's growing by the day the possibility is growing by the day when you look at sort of the um the events that are unfolding and you know the inflation numbers that are out there the the recent action here in the ukraine i think is obviously pushing up raw commodity prices significantly that's going to have a follow-on effect there's further supply supply chain know implications there as well and and that's going to obviously drive our prices um so inflation's not good for the markets and then you've got the fed who needs to combat that and try and juggle between the two and they're looking at obviously tapering and raising rates which i'm not sure they'll be able to do so successfully but yeah i think there's a lot of reasons to be uh to be to be mindful of that um the two 10-year curve as well you know sort of it's flattening out so there's reasons to to be very much concerned that uh we're going to go into a slowdown or recession yeah well it's the other side of the euphoria we've had for so long isn't it just that potential right yeah i mean the one thing is though that the fed has kind of found this new kind of magic bullet um that they keep playing when the when the market gets weak or the economy gets weak they just you know they accommodate more um and i think they kind of have overused that and are stuck using it right now because they just don't want to go through the necessary pain you know i mean the business cycle was just a cycle and you know if you train and abort the the trough then you're boarding the cleansing elements of a cycle low or decline in in theory recessions are healthy they take out the excess or the uh you know the capital that wasn't allocated uh correctly and if you don't punish those players then you just uh you're adding on you're adding on so yeah the response out of this may be that the fed has to double down again and the markets keep driving higher but of course at some point you know the bill is going to be paid right and um who knows when that is though right i mean earlier on earlier on in the in the 2000s i was very much you know aligned with kind of the idea that the country's bankrupt the world's bankrupt and and we're a year or two or three away from you know armageddon and complete collapse of the fiat system and all the buzzwords you hear right um i've learned that you know time you know respecting time it's difficult and you know these types of environments can carry on forever i mean the the deficit's a good example of that i th
2022-03-11 17:35
