Could Bitcoin Reach Zero? (June 19 2022)
Market Zones strength is the concept of a "Chart Fair Value" the middle zone region of a chart. Typical price movements for many instruments is for price to oscillate around the fair value ranging to Lower or Upper Extremes, and working back to the Fair Value, that's just how the price behaves travelling up or down the various Zones.
The Good News as of now Zero value is not in the Fair Value middle zone of any serious Bitcoin Chart plotted time-frames The Bad news is it does appear in the Lower Zone across many Charts, usually it is above the Lower Extreme Zones that are actually fairly large negative numbers! Interestingly this is not true of many instruments say stocks do not often have large negative ranges and if any would be well below Lower Extreme zones lines.
So it is theoretically more probable from a Zones perspective for Bitcoin to reach Zero than other financial instruments say like Gold or Oil, or many Equities where negatives or zero does not even appear on any chart on a steady basis at least, but Market Zones cannot predict Bitcoin whether it would actually go there.
While there exists a "gravitational effect" pulling price that is in the Upper or Lower Extremes especially back to the central Fair Value zones, after price reaches Fair Value on a give Chart there is nothing to indicate what direction it would go next However once the price is in the middle Zone, if one has non-Zones based preferences about direction, Zones can help with formulating Entries/Exits and Stop Losses based on Middle Zones lines.
Having said that Zones can reveal some possible scenarios that may occur next, and trading plans could be built around these below based on the 520 Minute Chart:
Scenario 1: Price is currently slightly below the lower line of the Mid Zone (25K), the next zone below would be the top of the Lower Zone at 9.5K Price could continue to there, 9.5K could be considered as support From there again it could break down below that and head towards Zero next or turn back around
Scenario 2: Price could turn back around without reaching 9.5K and return to the middle line of the Middle Zone -32K- and potentially break above that - in this scenario the lower 24K line of the Middle Zone should be considered support, noting here the moving average is above this as of today, it is technically still the active support area
For those who are generally from say a Fundamentals perspective optimistic about Bitcoin could consider Buying Bitcoin if it comes back up to around 34K-36K, above the exact Fair Value 32K, with a Stop Loss at 22K, below the Lower Middle Zone point of 24K One can see in the Chart that the upside potential is vast with the Extreme Upper Zone starts at 104K, even the Upper Zone is at 85K-ish So the risk : reward is not prohibitive.
Of course bearing in Mind Zones cannot anticipate such an up move from the internal dynamics Zones theory, it is not any more higher probability to go up as to go back down and hit the Stop Loss, but it does help calculate risk/reward and formulate good Entry and Exits, Stops if one has other, non-Zones, reasons to be choosing a particular direction
Figure 1: 520 Minute Bitcoin Chart