# Bitcoin Accumulation Strategy: Confluence, Cycles, and DCA

**Podcast:** The Milk Road Show
**Published:** 2026-07-14

## Transcript

It doesn't have to be all in.
You need to think granularly, probabilistically, rather than, you know, ones or zeros, black and white.
No one's going to buy the exact bottom and sell the exact top.
It just doesn't happen.
If you DCA and chill, not only do you get a good sleep at night, but you're going to get a hell of a better entry than a vast majority of people who are going to miss the bottom entirely.
and just watch Bitcoin skyrocket before you have to FOMO back in close to those highs and miss another bull market.
Bitcoin is pumping today back up to 64k.
A lot of people are wondering if the bulls are back in control or if this is just another fake out before the bears take us down to Goblin Town.
Hello and welcome to the Milk Road Show, the podcast that knows that trying to pick the bear market bottom is fun, but it would be a lot more fun if Bitcoin would just yeet to Valhalla.
I'm your host, John Gill, and today is Tuesday, July 14th, and today we are joined by Matt Crosby.
Matt is the Director of Research and Analytics for Bitcoin Magazine Pro, specializing in on-chain analysis, Bitcoin market cycles, macroeconomic trends, and data-driven investment strategies.
Matt is a friend of the show, a regular here, and a favorite of all the fans of Milk Road.
So if that sounds good to you, Matt's brought a ton of charts today.
I'm really excited for this conversation.
So if that sounds good to you, make sure you like and subscribe.
Share this episode with somebody who's going to enjoy it.
Today's episode is brought to you by BitGet, stocks 2.0 with real liquidity, real dividends, and securitize the regulated rails for tokenization.
And without further ado, welcome to The Milk Road Show.
Matt, how are you, sir?
I'm very well, thank you.
How are you, John?
You know, I'm doing well.
I'm really excited for this conversation.
I've watched you with LG a lot of times.
I always learn something and you always have kind of like a sort of like meta narrative take on the market.
And I'm really curious what your updated outlook is here.
I've heard people calling for a double bottom, triple bottom.
A lot of people are saying we're going to 40K or below, which still sounds crazy to me.
But maybe let's just start with this.
How are you thinking about Bitcoin today?
What's your updated outlook on the market?
And yeah, what's up in your world, Matt?
So I guess very short term, we have had a little bit of a positive jump today.
I think that was in reaction to the more bullish CPI news that we've got coming in under expectations.
Maybe inflation isn't quite as high.
Maybe there's not going to be as many federal rate hikes as we may be anticipating this year.
So it is a little bit volatile at the minute, but I guess.
Big, big picture things.
Macro is the question on everyone's lips.
Has Bitcoin actually bottomed out somewhere around that 57, 58 K?
You know, is that the low?
Are we going to go lower?
Is it going to last another few months?
You know, it's the million dollar question.
I'm going to be honest.
I don't have a crystal ball.
I don't know exactly what's going to happen.
No one does.
If they do, then they probably have the best snake oil in town.
But what I can say is we have a lot of data points pointing towards this at the very, very least being a very asymmetric opportunity to.
to consider at the very least accumulating some discounted BTC.
The way I'm looking at it right now is it's buy on, get on free Satoshis.
And as I said, from the on-chain data, from some macroeconomic perspectives, from some technical derivatives, all of these little pieces of the jigsaw coming together are, again, just providing some probabilistic confluence that right now, you know, Bitcoin is for buying.
Gotcha.
Okay, so you...
Can't predict the future.
And a lot of people are trying to pick the bottom.
But you're saying, setting that question aside, this is a great entry and a great opportunity on Bitcoin.
I think that's a great perspective.
And I think that's kind of been the way I've been looking at this, too.
Do we want to hop into some charts and start breaking down what you're seeing going on on chain?
Yeah, sure.
So we'll jump straight into it here on the realized price.
Probably one of the most.
popular metrics we've been seeing recently.
A lot of people are saying, you know, I'm not going to buy until Bitcoin reaches kind of the low $50,000 region, the high 40K.
Everyone was looking towards that 200 weekly moving average, which is currently around $63,000.
And we've been kind of chopping and hovering around that.
And I mean, it makes sense to look at the realized price, which is kind of the average accumulation, the cost basis of all BTC on the network and say, well, In every single bear market, we've actually dipped beneath this.
So surely it would make sense to wait until we dip beneath it again this cycle.
And alongside that, there's some other pieces of confluence which, again, point towards maybe some lower prices being on the cards.
If we look at the long-term holder realized price, which is purely looking at the cost basis of the more experienced market participants, those classified.
as long-term holders, and as well as that the cumulative value days destroyed.
One of the more complicated metrics, again, if you go on BM Pro, you can scroll down, see how all of these are formulated, but we can see every single bear market has bottomed out on this level.
So why am I just waiting until Bitcoin hits $50,000 going all in and riding the easy train to bull market town?
I think there's a few little niche nuances we need to take into consideration here.
For example, the realized price, which again is just the average accumulation price.
If we look at the ratio between the underlying price of Bitcoin and that, we get the MVRV, the market value to realized value ratio.
Now, again, what we can see is underneath the value of one indicates that Bitcoin is beneath this realized price.
So again, it would make sense.
Every single bear market we've dipped beneath this.
But we also have to consider every single bear market we've dipped beneath it slightly less.
Now, what we can do, and this was part of an article I released recently, just a free one.
So again, go on Bitcoin Magazine and check this out.
If you actually draw a statistical line of best fit through the peaks and the troughs of this data, it's actually pointing to not actually crossing beneath a value of 1 this cycle, which would mean we might not actually dip beneath that realized price.
So again, could it happen?
Yeah, of course.
But I think especially now there's institutions getting involved.
Bitcoin in general has just grown from a few billion dollars to a multi-trillion dollar asset.
There's a lot more game theory involved with, you know, what are these treasury companies doing?
Where are these passive flows going?
Who's actually selling?
I think the days of Bitcoin being a very simplistic, you know, four-year cycle, you know, you can practically set a date on your calendar of when to buy and when to sell.
And you can put, you know, two indicators on your chart and it's easy peasy to know exactly what to do.
I think we might be getting past that point.
Now, again, we could go as low as that.
We could reach these levels.
All I'm saying is if you're the guy who was buying Bitcoin in the 2022 Bitcoin bear market and you're buying $18,000, $19,000, no one looks at those buys and says, man, you must be disappointed that you didn't buy it exactly $15,600.
Or you look to the guy who bought in 2018, who bought it.
four and a half K and you say, man, you must be kicking yourself.
You bought 20% above where the ultimate low was.
I still think that's the case.
And right now, given the fact that we've already set that low in around 57, $58,000, do I think it's worth not even considering scaling into potentially eke out a few extra percentage of your Bitcoin?
For me, no.
For me, I'm seeing this as a great opportunity to accumulate some discounted BTC.
And again, I'm probably going to sound like a bit of a broken record throughout this entire show, but there's just a lot of value to be had here.
And I think Bitcoin in general, we have to acknowledge it's changing the four-year cycle, which was primarily driven by the halving event previously.
I mean, there's 95, 96% of all Bitcoin that will ever exist are already in circulation.
And given the inflows from new Bitcoin, you know, sailors buying more than that.
There's just so many new catalysts that are really changing the market.
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Okay, well, I don't mind a broken record as long as the music is good, and I think I'm picking up what you're putting down here.
So let me see if I can restate this.
So the first question I have on this is just exactly where that price level is, because you went through three different indicators there.
Is it 50K on the nose?
Is it 53K?
How much further down are we talking about this?
Because I don't see that price level clearly on the screen.
Where is that price level for you?
So again, these change every single day.
The realized price is currently around $53,000, but actually trending to the downside.
The long-term holder realized price is at about $50,000, but trending to the upside.
And the cumulative value days destroyed is about $48,000, $49,000, but again, trending to the upside.
So in not too long, they're all going to kind of meet at around $50,000, which again, would be a hell of a piece of confluence to have.
three of the most reliable, accurate, long-term metrics that we've used to predict Bitcoin bear market lows, all converging on one point.
But again, if we look at the 200 weekly moving average, up until the most recent or the previous Bitcoin bear market, we'd never broken beneath this.
This was always the Bitcoin bear market support.
And right now we're just on that.
We've actually had a few bounces from this level, kind of chopping around the 63K level.
So it's one of those.
You can look at...
Many different data points.
No one is going to be a holy grail, but those three in particular around the low 50k range.
Gotcha.
OK, so this is another thing I've been thinking about a lot throughout this entire cycle is, you know, if you look at this chart, one of the ways this is expressed.
in the the first cycle in 2014 there are some red dots in 2018 there's some red dots in the 2021 there's some you know green and teal ones but in the 2024 2025 they're all still in blue they never really got that overheated and you know i think this kind of plays into what you said before of like we didn't get super overvalued on the mvrvz score so maybe we're not going to go as low how are you thinking about that is that something that like you think that there's something to that trend is bitcoin just being more stable in price and less volatile?
Or like, what are your thoughts on that?
So a couple great points raised there.
Yes, I think the bear market paints, oh, sorry, the bull market paints the following bear market.
So the fact that we didn't have this massive exponential rally, it was almost three muted peaks to the upside.
If we look at something like the cycle master, which the cycle lows here, the green line is just that cumulative value days destroyed chart I showed previously.
But again, if we look at Bitcoin historically, we always reach this overvalued territory, which again, in this cycle, we didn't.
So maybe the upside was muted.
Maybe the downside was muted.
Maybe we don't quite reach as low.
But on your point of the MVRV, if we just look at the Z score, which is almost standardizing that MVRV data to account for Bitcoin standard deviation, the evolving volatility of the asset.
Again, we can see each of these peaks is lower than the last.
And if we look at the most recent bull market, many people will look towards this and say, yeah, but we've got absolutely nowhere near this upper red sell zone.
So can we even trust the data anymore?
And because of that, we've been working to try and not necessarily alter the data, but change our perspective on it.
Because if you look at, say, the 2017 bull market, which is a great example.
If you look towards the end of November 2017, this Z score value was somewhere around six.
I know it might be a little bit hard to read, but it was at 5.9 where I'm hovering now.
In less than two weeks, it'd gone to above 10.
So this moves very, very quickly as price had gone from around $10,000 to near $20,000.
So rather than just looking at raw values, because I think a lot of people are thinking in absolute, you know, I'm going to buy when we enter this green zone, sell in this red zone.
I'm going to buy on this day and sell on that day, whatever it may be.
So this is just from a paper that I published recently looking at a dynamic long term holder for classification for Bitcoin.
A little bit more complicated than we'll go on to today.
But what I wanted to focus on is kind of converting a lot of these metrics.
into almost quantile models.
So rather than looking at just the raw value of where did this data point reach, if we look at the amount of time it spends within certain bands.
So again, back to the MVRV Z score.
Yes, we do usually set peaks considerably higher than we set in this most recent bull market.
But we're actually in these upper echelons of data values for very, very short periods of time.
So if instead of just looking at these values, you again measure it more in terms of how much time do we spend in the top fifth percentile, the top 25th percentile, then again, you get these quantile models, which give us, at least in my opinion, a much better insight into exactly how the Bitcoin market is moving and where undervalued and overvalued may be.
Okay, so those kinds of market dynamics and moments are very extreme occurrences and very rare, and Bitcoin...
very, it spends a very small amount of time in those, those price ranges.
Okay.
So that's helpful.
Yeah.
I think keep going with this, but I would love to hear you expand more on this idea of, you know, this is maybe good enough and you're starting to accumulate.
Cause I think a lot of people are starting to wonder, should I start accumulating?
What does accumulating look like?
This just dump the clip all at once.
Is it DCA?
Is it wait till it gets under 60 and start nibbling?
I'd love to hear your thoughts on that, but.
Just keep going, man.
Yeah, sure.
So what I actually did is I wanted to take this kind of oscillator one step further, because again, we can kind of see that it's outlining this top fifth percentile, the top 10th percentile.
So what we can do is almost change this into bands.
So what we can do, we're just in trading view here.
And again, what we can do is separate Bitcoin's price, not by the raw data values, but the amount of time it's spending in these top.
kind of percentiles, the top quantiles, and almost work backwards.
So again, what this is using is the kind of declining MVRV peaks that I mentioned in this article and the rising MVRV troughs.
If we just look at the data here, we can see how it looks here.
But then this gives us this almost quantile viewpoint of where Bitcoin is.
So even a lot of on-chain metrics didn't really call the most recent bull market peak.
We could see it was in kind of the top 5%, the top 10% of data points.
And right now, I mean, recently we have bounced, but we were just on this lowest 5th percentile, lowest 5th percentile.
So if we just go into the daily timeframe here, what this really shows us is 95% of all of Bitcoin's history, we were...
higher in terms of its valuation, its relative value to the MBRV than we were just a few days ago when we reached $57,000, $58,000.
So for me, if I can buy Bitcoin at what is essentially a 50% discount in terms of dollar amount, when taking into consideration the drawdown from the all-time high.
But that's also aligning with Bitcoin reaching the bottom fifth percentile in terms of value days when looking at its ratio from the MVRV to the underlying price of Bitcoin.
I mean, comparable moments, again, when Bitcoin was at $20,000 in the previous bear market and then ultimately at the bottom at the COVID 2020 dump, at the 2018 bear market low.
To me, It's not about trying to go all in.
It's about looking at where Bitcoin is and trying to strategically dollar cost average into the market.
Because again, if I can see that Bitcoin is historically undervalued, and this isn't just from one viewpoint, because we can look at something like the...
production cost of Bitcoin, because this is looking at how much it actually costs to make Bitcoin.
So within this data point, we actually have both the electrical cost, which is kind of this lower red line here, and the total production cost, the purple line, the thick purple line, which includes the hardware costs as well.
So not only do we see Bitcoin is incredibly undervalued looking from a on-chain or investor psychology perspective, but from a fundamental standpoint, if you can buy Bitcoin for practically how much it costs to make a Bitcoin, Again, just simplistically, that's a pretty good deal you're getting.
And if we look throughout the entire history of Bitcoin, any time that these have happened, this Bitcoin reaching or slightly dipping beneath this production cost, it's been an unbelievable accumulation opportunity.
So again, we're right at this level of multiple points of confluence from a fundamental, technical, macroeconomic, derivative.
All of these are kind of pointing towards Bitcoin being in value territory.
And a lot of people are going to look towards the fact that we haven't had this 70, 80, 90% drawdown that we typically have.
We haven't reached X, Y, Z data point.
And the big one I'm seeing is, you know, Bitcoin has these four-year cycles where we peaked last year in October, October 6th, 2025.
So I'm not going to buy until October 6th, 2026.
Now, could that play out?
Of course it could.
But again, we have to take into consideration in the previous bear markets, It took a year to reach this point.
It took a year for this level of capitulation to happen on chain.
And it took a year for Bitcoin to reach this production cost of Bitcoin.
The fact that we've reached this level in six to nine months, again, I'm not...
ignoring this data in favor of how many times the moon has gone past my bedroom window on an evening.
Because to me, I think it's missing kind of the x-ray vision that Bitcoin allows us to have.
If we were trading stocks or equities or commodities, where we have to wait months to see who's buying and who's selling, what the sentiment really is, not just by taking polls, but by looking at fiscal monetary sentiment, what are people doing with their money?
Bitcoin allows us to do that in real time.
It's crazy that people will overlook on-chain data, and especially the fact that ETFs are now here, and people are saying, well, on-chain data must be becoming less effective because a lot of Bitcoin's moving off-chain and in these centralized custodians.
Potentially, but if you look a few years ago, I mean, everyone was trading on Binance or Bibell, FTX.
It's not like on-chain data didn't work back then.
And even now, ETFs are mainly spot ETFs.
They have to declare the buying and selling that's actually taking place.
But one final point, because I feel like I'm rambling a little bit here.
I'm letting you go.
Go right ahead.
On the topic of kind of seasonality and how long bear markets usually take to play out, at least from my...
viewpoint, there's two phases to true capitulation, to actually ultimately finding a bottom.
And that is the obvious one, the price-based capitulation.
We have the big sell-off.
And this was initially when we went down to $60,000.
We had this big monumental move to the downside and everyone's fearful.
Everyone's thinking, man, are we going to go to 50K?
We're going to go to 40K?
How bad can this get?
And then...
We never really have these V-shaped recoveries.
A lot of people thought we'd hit this 60K level and bounce back, bull markets back on.
It doesn't usually play out like that.
Usually there's around four to six months where Bitcoin kind of does nothing.
A lot of people are frustrated.
People have capitulated.
Everyone's looking to other markets.
Now, if we look to the previous Bitcoin bear market, when we had this initial drop beneath $20,000, How long did it actually take till we set that final low?
And then a few weeks later, we actually really rallied hard off.
We can see it was about 156 days.
Now, if we overlay that onto the current Bitcoin price section, that would point towards the 12th of July.
As you stated, we're filming this on the 14th.
So that was a couple of days ago.
we might not be a million miles away in terms of time-based capitulation taking place.
When not only are people upset that they've lost money, but people are genuinely angry.
People are upset.
People aren't just worried if Bitcoin can go lower.
They want Bitcoin to go lower.
People have lost all hope in the market.
You know, I'm transitioning to AI.
I'm pivoting to whatever AI stocks are going on right now.
Who knows?
This happens every single cycle.
And every single cycle, Bitcoin rallies hard off the lows.
It's not like we have this slow grind up.
If you look at 2022, if you look at 2018, 19.
I want to stop you here.
You just went for like 10 minutes in a row.
And I want to kind of like synthesize some of this for the audience.
Okay.
So what I'm hearing you saying is that all of these...
Bull markets and bear markets for Bitcoin, they rhyme, but they're all a little bit different.
And this time, you're seeing a confluence, not just one economic indicator or macro indicator or on-chain indicator, but a sort of confluence of several things that make you think that we could be near the low on the bear market.
And you said on the time it took us to get to the production costs, like the electricity and the production costs on Bitcoin, it only took us six to nine months, whereas before it took us a year.
And then I want to have you just repeat that.
Go back to that last chart.
I want to have you repeat this one for the audience to understand what this means.
So what is the window of time that you're measuring here?
And why do you think that this means that we might be through the capitulation window?
What time period is that versus where it was historically in 2023?
Just repeat that for me so I make sure I understand that.
Sure.
So the big sell-off we initially had in the 2022 bear market to sub $20,000.
That was, by all on-chain indications, the initial price-based capitulation.
That was when people had lost hope, were terribly upset.
I can't believe Bitcoin has done this.
I can't believe we've had another 78% retracement.
I've just bought it at the highs.
There's a huge amount of fearfulness in the market.
There's a huge amount of people genuinely sorrowful and upset that their favorite asset has done this to them.
And if I just go back to this jar here, we can see.
This usually comes in two parts.
This is the price-based capitulation, the big violent sell-off.
But then there's the second part, the time-based capitulation.
And if we look at how long this took in 2022 into 2023, it was around five months.
And after that, we set a lower low, and then we rallied off the lows.
What was the price we got to there?
Was it like 16K or something like that?
So it was initially...
Yes, I'm actually not on the easiest chart to see this.
I'll go into this one.
because that was in the market cap.
So we went down to $19,000 on this initial dropdown.
And then the ultimate low was somewhere around 16K.
So we went about 12% lower.
If we look to the 2018 and 2019 bear market, similar situation happened.
We had this big violent sell-off and then we didn't actually set a lower low, but around four months went by before we set a similarly low low.
And at this point, it wasn't people being upset that Bitcoin had done this.
It was pure.
anger.
People had gone, there's that Wall Street cheat sheet where you can see the different phases of despair and anger and capitulation.
If we look at 2015, again, we had this initial sell-off and this one was slightly longer, about seven months.
And then on the secondary low, this was actually a slightly lower low.
This is just looking at the daily closes.
But if you look at the WIC actually sent a slightly lower low.
And again, this was the time-based capitulation.
But again, in each of these circumstances, after this time-based capitulation had occurred, we rallied off the lows.
Within 100 days, we'd gone from around $200 to around $460.
In the next bear market, we went from around $4,500, well, $3,500, $4,000 to about $12,000, $13,000 in the next 100 days.
And then in the most recent bear market, again, we went from around $16,500, $17,000 to over $30,000 within 100 days.
So Bitcoin, after it has this price-based, four to six months later, time-based capitulation.
It maybe has another week or two and then lights out and away we go.
Where in that process do you think we are in this bear market?
Because we had sort of like the February flush to 60K, 58K.
It's been now I think five months or something like that since then.
Do you think, that's what you're basically saying, is you think we have now seen, it's possible we've now seen the time-based capitulation?
Is that what you're telling me here?
I can't say for certain.
if we have or we haven't.
It's one of those where it'll only be obvious in hindsight.
But again, you take all of these pieces of confluence and say, we're not a million miles away.
So another piece of confluence I like to look towards is rather than just measuring Bitcoin as a fiat currency debasing versus asset, usually...
the US dollar.
If instead we measure Bitcoin as a percentage of global capital, we look at the relative purchasing power.
Because if we look at Bitcoin again, priced in US dollar, we set this all time high on October the 6th, 2025.
But if we actually look at how much you could buy with that Bitcoin, it actually decreased on that date.
And if you ask anyone the sentiment at that time, it didn't feel like we'd set a new all time high because At that time, gold was rallying exponentially.
Silver was going crazy.
Equity markets were all time high.
It felt like Bitcoin has stagnated, even though we were at all time highs.
And if you look at how many goods and services you were able to purchase with your Bitcoin, if we look at the comparable purchasing power, again, it was lower.
The actual peak was a year ago today, on the 14th of July 2025.
At that point in time, Bitcoin's percentage of global capital was about 0.4852%.
where we live today is about 0.21%.
So more than a 50% retracement, because again, even though Bitcoin has gone down around 50% in US dollar terms, global M2 has expanded, equity markets have grown, commodity markets have in some areas, you know, also expanded.
So if we measure Bitcoin as a percentage of global capital, it gives us a more true representation of what we can actually exchange our Bitcoin for now.
People say, you know, never sell your Bitcoin.
Well, some people might change their opinion on that at some point.
But ultimately, if we're going to live in a Bitcoin standard hyper Bitcoin world, you know, it makes sense to understand when there may be more opportune moments to rotate into a house.
So you have a roof over your head or that vacation you deserve or a nice new car, whatever it may be.
There's times where we can kind of understand Bitcoin is definitely more under or over value.
Just on the time-based element as well, this is another piece of confluence where if you look at Bitcoin's previous bull markets, those peaks all occurred again in terms of percentage of global capital and US dollar equivalent at the same time.
This most recent bull market was the only time when we had this discrepancy and this divergence where Bitcoin's relative purchasing power actually topped out months before we did in fiat currency terms.
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Gotcha.
Okay.
So you're saying that in purchasing power terms, Bitcoin has found a level that...
used to be resistance has been flipped into support and historically has held for, you know, a very long time as support here on this.
And it's another piece of this confluence.
I like the idea of confluence, like not relying on one indicator, but getting a lot of them together.
So this is helping to paint a picture here.
So I'm following you so far.
Good.
I'm glad because I'm very much aware that I can ramble and rant and go off on some tangents.
I'm just trying to make sense of this.
You've got a lot in your head.
These charts are beautiful, by the way.
So, you know, Director of Research is doing a great job.
Thank you very much.
It's much appreciated.
But again, if we look at Bitcoin through this lens of global capital.
As I said, I think it gives us a more true representation because we're all aware fiat currencies are basing at 4%, 5%, 6% plus every single year.
That $10,000 you stuffed under your mattress in a few years' time isn't going to buy you $10,000 worth of goods and services like it used to.
So if we look at something like GlobalM2, so just strip back Global Capital and purely look at the amount of dry powder that capital sidelined.
Because GlobalM2 last year was kind of one of the...
more popular.
It was like the hot topic chart to look at.
But I'd always thought it was a bit dubious to purely look at M2 in isolation because global M2 typically trends up and to the right.
It's very rare that we see sustained fiscal responsibility from central banks and governments.
Usually this is up and to the right.
So a lot of people were very upset when Bitcoin was going lower, but global M2 was actually trending up and to the right.
We saw an expansion global M2.
If instead we look at Global M2 on a year on year basis, we can see the correlation between Bitcoin's returns.
It's almost one to one because it's not necessarily that we're seeing contraction in Global M2.
It's just the rate of acceleration of expansion has massively declined.
And if we look at this, this almost makes me question if the traditional four year Bitcoin cycle, which everyone has been singing, is tried and tested and true.
And it's always going to play out like that because we have this big fundamental.
economic catalyst in the halving event.
And undoubtedly, that used to have a monumental influence.
But we can also see looking at this over the past decade plus of Bitcoin, have we really just been a positive influence kind of reaction to monetary expansion, more global M2 liquidity entering the system?
It's hard to really argue that this hasn't had a monumental impact on the Bitcoin price action.
And if we just line up where these howling events occurred, you know, in early 2020, just before this massive expansion in Global M2.
Again, mid 2024, just before this big bull market, bam, right before another massive expansion in Global M2.
So again, has it always been this four year cycle due to Bitcoin's own economics or has it been external influences and human psychology, et cetera?
And again, if we look at Global M2, rather than just on its standard chart and on a standard year-on-year basis.
But if we give it almost a 10-week, 70-day offset, we can see the correlation between these two data points actually increases to about 76.2% throughout the entire history of Bitcoin, which is a pretty strong correlation.
And again, what we can see, even though global M2 was increasing as we set this all-time high and then actually started retracing, on a year-on-year basis with this offset, it actually started moving to the downside.
Now, this is one piece, again, that maybe points towards the fact that Bitcoin maybe hasn't truly fully experienced this time-based capitulation.
I'm not just a non-stock bull on Bitcoin.
I'm well aware that there could be some headwinds ahead of us.
We could have a US dollar index, DXY, continuing to increase.
We could have Global M2, again, not really expanding at the rate we'd like to see.
So there's definitely not plain sailing ahead for Bitcoin.
But again, if we look at all the pieces of confluence, at the very least, it's a good area to consider scaling into some discounted BTC.
But this just, again, plays to the point that this blind seasonality of I'm just going to follow the calendar, the day of the year that we're on, I'm just going to follow this one indicator, the holy grail doesn't exist.
And all models will break eventually.
This traditional four-year cycle, I mean, it's moving goalposts because it was always, oh, we have three green years and then one red year.
well, we didn't do that last time.
And then it's going to be, oh yeah, but it's four years between the highs, not between the lows.
There's always going to be moving goalposts.
That's why, again, it's important never to focus on just this one data point or this one element of Bitcoin's market dynamics, but to try and view the entire picture.
Yeah, and I think that this has been something that has frustrated a lot of investors in Bitcoin, which is the break of this correlation with Global M2.
My read on this, not to get too deep in the weeds here, but I've been thinking about this a lot.
My read on this is that the excess liquidity of increasing Global M2.
usually has gone into Bitcoin digital assets.
And now the excess liquidity is speculating on other things.
That doesn't mean that liquidity is not there and it doesn't mean it's not going to rotate.
But for right now, I think that there's been this sort of decoupling of this historical trend.
And just like you said, the confluence of a lot of indicators is what you need to watch, not just one thing.
And I think a lot of people were really hanging their hats on this one single macro indicator.
And yeah, the market continues to evolve.
Bitcoin continues to evolve.
And things are going to change as we go forward here.
Yeah, so I think it's helpful to kind of see this framed this way.
So thank you for that.
No, of course.
And you have to acknowledge strength usually attracts strength.
almost institutional investors on a pedestal, these ETF buys, these treasury companies, we can see time and time again, they usually buy the top and sell the lows.
If we look at the 28-day average inflows and outflows of these ETFs, now I know they're not all institutional buyers.
I think it's somewhere around 40%.
But what we can see is this smart money, these deep pockets, these Blackrocks, these big institutional players with all this knowledge that those retail plebs don't have.
Yeah, they're buying actually peaks as Bitcoin tops out and they're selling bottoms out as Bitcoin bottoms out every single time.
They're not very good at timing the market.
In fact, if you overlaid this onto something like the Bitcoin funding rates, again, it actually looks very, very similar.
So I think a lot of people look at these institutions and are saying, you know, they now control the market.
Well, one.
Their net inflows are somewhere around 600,000 Bitcoin.
In the previous bull market, we had somewhere around 10 million Bitcoin change from long-term holder hands to short-term holder hands.
So again, it's a bit of a drop in the bucket in terms of the grand scheme of Bitcoin supply and demand economics.
But then the fact that we're seeing these ETF outflows, maybe they are rotating into AI, maybe they are rotating into SanDisk or whatever storage or whatever the next hype thing is, SpaceX.
If that is the case, I don't think that's a terrible indication because, again, at some point we are going to see Bitcoin showing some renewed strength.
And it's almost like a chicken and egg scenario.
Do these ETF inflows cause price to go up or does price going up cause more ETF inflows to go in?
It's hard to say for certain.
But what we can say is this is almost a contrarian viewpoint that just because there are ETF outflows isn't a reason to worry.
In fact, it's probably another, you know.
piece of evidence that we should be doing the opposite of what majority of participants are doing.
Yeah, well, I think that we just saw this start to flip into the green for the first time.
I think last week we saw, I think, close to $200 million of inflows into Bitcoin.
So somebody's buying the dip here.
And I do want to get your answer to that question at some point I asked earlier about.
how you're thinking about buying a dip here?
Because that is the question on a lot of people's mind is, do you just dump the clip in now and say this is close enough and just hold your breath for six months and wait till we start to climb higher?
Or are you just nibbling?
I do want to hear your thoughts on that at some point here.
Yeah, of course.
Sorry.
Yeah, sorry.
I skipped over that a little bit earlier.
Right now, DCA and chill.
I don't want to be taking excessive stress or leverage into the equation.
I can see Bitcoin is at a discount.
And every time we kind of get lower on that quantile bands or lower in terms of the NVR view or whatever it may be, I'll buy a little bit more.
It's not a very complex strategy.
It's, you know, buy Bitcoin.
I get paid sometimes in Bitcoin.
So there's always kind of this DCA going on.
But I also get paid in fiat currencies as well.
And I put that dry powder to the side for opportunities like today.
I'm not going to time the Bitcoin bottom.
I'm just not going to be able to do it.
But if I buy every single day, you know, I'm going to get some around there.
I think right now, and I've been pretty public.
If you go to my Twitter, I'll show all the buys that I'm doing.
The low $60,000 region is my average entry price.
And if that's within 5% of the ultimate Bitcoin low that we set this bear market, man, am I going to gloat and boast about that?
But yeah, I don't want to be awake every night, monitoring the charts, thinking about how low we're going to go.
Is my buy too high?
Did I set that?
trailing limit order a little bit too far away is it going to miss i don't want that stress dca and chill i don't want to just try and outperform in terms of monetary profit gains i want to try and outperform in terms of how much time i spend actually having to to put into this and how much you know mental effort goes into this i mean i'm a little different because this is my job and i love doing this but for the everyday person you don't want to be spending you know 12 hours a week of your free hobby time looking through a thousand different charts and, you know, gain paralysis by analysis.
That's for me to do.
That's for the professionals to do.
Just take into account a handful of data points and clearly understand when Bitcoin is at a discount, it's probably time to be a little bit more aggressive.
But back onto this, because I have another really interesting data point I think you'll like, because the BTC ETFs have only existed since early 2024.
So I wanted to see this phenomenon of...
you know, bad timing from ETF buyers, because I did some analysis on this.
If you bought at the peak inflows and sold at the peak outflows, you'd be down about 80% on your Bitcoin holdings by just following the ETFs.
If you did the inverse, which I know is impossible, in hindsight, it's easy.
But if you bought at the peak outflows and sold at the peak inflows, you'd be up about 7x on your position once you compounded that with no leverage or anything.
So interesting to show.
But I wanted to run this analysis on GLD, the biggest gold ETF.
Exact same thing.
Peak GLD inflows occur when gold is topping out.
Peak outflows occur at the most opportune moments to scale into the market.
Big institutional smart money investors aren't really that good at timing the market.
But again, like I said, in the grand scheme of things, it's actually pretty promising because when the ETFs were launched, I think myself and many others would have probably been in the same boat as mine.
Maybe these guys were just in for a quick buck.
Maybe they weren't really here believing in Bitcoin long term.
But as much as there's been billions of dollars of BTC ETF outflows, really in terms of cumulative outflows from the peak we saw around 747,000, there's only been about an 18% reduction.
in BTC holdings.
So they actually have a lot of conviction.
If you look at the, you know, lettuce hands, short term speculators that we've seen coming in onto the, you know, derivatives markets, they've sold a hell of a lot more than these ETF holders.
So I think this is pretty promising.
And I think it shows Bitcoin's long term potential that a lot of more traditional investors have realized that this isn't just a flash in the pan asset.
And are now looking to not just buy, you know, one Bitcoin, five Bitcoin, 10 Bitcoin, but how can we allocate 1% of our portfolio to 5% of our portfolio into this highly liquid 24-7 market, which has the asymmetric opportunity that no other markets really do.
I mean, if we look at gold from 2024 to its peak, it rallied about $20 trillion, about 10 times the Bitcoin market cap when we were closer to our peak.
That's a monumental amount of capital that rotated into gold.
for exponential gains in an asset that has a 30 plus trillion dollar market cap.
Bitcoin's a $1.5 trillion market cap asset right now.
It is a tiny, minuscule drop in the bucket.
And it's not going to take a lot of capital to really start accelerating this asset to the upside.
And as we've said, strength attacks strength.
When AI stocks are booming to the upside, do traditional investors, do retail participants go, I think we're a little bit overvalued?
No, you buy more.
You see these massive exponential, you know, complete break from fundamentals, complete break from fair valuations to the upside.
Does that matter long term?
Potentially does it matter short term?
No, because you don't want to be missing out on these gains.
You don't want to be on the shareholder meeting saying, why didn't you buy the SpaceX IPO?
You know, everyone knew it was overvalued.
It's still rallied by what, 0.75 trillion dollars in a couple of days, like crazy half the Bitcoin market cap in a couple of days.
The markets now, I think, are becoming.
more irrational than they ever have been.
And I think that trend is going to continue.
And to me, it's worth leaning into it rather than, you know, trying to, you know, big brain it or trying to let your ego get involved.
Just follow what the data is doing.
Don't try and predict things.
Try and react unbiasedly, unemotionally to these data points.
And you'll do better than 99% of people involved, not just in Bitcoin, but in any market.
I think that's a lot of wisdom right there, Matt.
I feel like you've got a lot more charts, but we're getting close to time here.
So I want to give you a chance to sort of like synthesize some of this for us.
But I do like that perspective on not trying to force a point of view onto the market, but take the information the market is giving you and come up with a strategy that makes sense for that environment for you.
To kind of bring this together here, is there anything you want to show us to sort of like put all this together or how do we like tie all this together for people?
I feel like we only made it about halfway through what you had prepared.
I always way over prepare.
I'm ready to do a four-hour show next time.
We're going to really go for it.
I think the one shot I would like to finish on, which people may not like, I don't know exactly when this is going live, but I don't know if you've been following the World Cup.
I certainly have been.
Big-time England fan.
The one data point I'm looking towards is, I don't know whether to say if or when, but...
But if slash when England win the World Cup, the last time that happened, which was nearly 60 years ago, it did mark the beginning of over 16 years of zero gains for US equities as measured by the Dow Jones.
16 years of sideways chop and consolidation.
So I'm prepared.
And to be honest, I think it's a worthy trade off to see Bitcoin chop and consolidate until 2042 to see Bitcoin, to see England win the World Cup.
I'm going to hold my hands up and say I kind of hope that happens.
I think, again, I can live with that.
But if England do win the World Cup and we do have chopping consolidation in 2042, I apologise in advance.
I think it is absolutely hilarious and so representative of you and your personality that you actually prepared a chart to make that joke.
So mad respect for that.
Matt, I think what I'm hearing you say is that Bitcoin is by many metrics and by a confluence of these metrics near to the bottom than the top.
So it now makes sense to start thinking about what, you know.
your specific strategy is for accumulating.
And I really like what you said about DCA and chill, because a lot of people forget that there is a cost to investments outside of just the dollar figure, right?
There's the emotional stress, the mental stress, the focus and attention that that takes.
So making sure that you come up with an investment strategy that gives you peace of mind and allows you to get exposure to the assets you want without losing night's sleep over it or getting the Bybit sweats because you're on too much leverage or something.
I think that's also a really important piece of advice at this point.
Because like you said, Bitcoin is going to rise again.
There will be another bull market, but we don't know exactly when that's going to be.
And making sure you're positioned so you can be patient and wait for that to happen is important too.
Any other closing thoughts besides go England that you want to leave our audience with, Matt?
Realistically, if you're watching this video, you're probably a long-term believer in Bitcoin.
Now, maybe you think it's going to go slightly lower.
Maybe you think we're going to be drawn out till October until we really set the lows.
That might be true.
But if you do think Bitcoin has...
any potential to flip gold, to flip silver or become the world's number one asset, then a million dollars, again, it may be a decade or two down the line, but if you do believe that, then a million dollars is inevitable.
So right now I'm looking at Bitcoin and thinking 99.4% discount.
I don't mind if I do.
And I think ignoring the fact, ignoring all the data, ignoring everything else and trying to squeeze out.
An extra few percent is, you know, picking pennies up in front of a steamroller.
And I think it's, you know, letting your ego get in the way.
It doesn't have to be all in.
You need to think granularly, probabilistically, rather than, you know, ones or zeros, black and white.
No one's going to buy the exact bottom and sell the exact top.
It just doesn't happen.
If you DCA and chill, not only do you get a good sleep at night, but you're going to get a hell of a better entry than a vast majority of people who are going to miss the bottom entirely.
and just watch Bitcoin skyrocket before you have to FOMO back in close to those highs and miss another bull market.
Well, if you want to see how I am DCA-ing and chilling where my buy levels are at, you can join Milkroad Pro for a dollar.
Matt Crosby, head of research and analytics for Bitcoin Magazine Pro.
Thank you so much for being on the Milkroad Show.
I really appreciate you, Matt.
No, it's always a pleasure.
Genuinely, my favorite podcast appearance to do so.
Happy to come back anytime and just talk nonsense, talk charts, talk data, talk England winning the World Cup, I'm sure, by the next time we speak.
So yeah, thanks to all your audience and thanks to you, John.
Thank you all for joining us.
I hope you all learned something today.
So until next time, stay safe, stay educated, stay bullish, and we will see you all on the next episode of The Milk Road Show.
Thanks for being here, everyone.
Bye.
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