In order to get an understanding of where crypto prices are going, especially the “currency crypto coins” (like LTC, Dash, BTC, etc.), it is important to do intermarket analysis.

Intermarket analysis is looking at how a particular sector or good (such as crypto currencies) perform in relation to other relevant goods or sectors, instead of just looking at the good (such as cryptos) in isolation.

When looking for a sector or good related and relevant to cryptos, there is almost nothing more appropriate than the US dollar.

Now, I have been following the US dollars for years, knowing that eventually there will come a big US dollar collapse. However, it is not easy to find a good way to benefit from such a collapse, but then came Bitcoin and the altcoins.

In my opinion, investing in Bitcoin and (especially) altcoins is the ideal way to short the US dollar or benefit (or shield) from its collapse. Hopefully you will see why, below.

Below, is a long-term chart of the US Dollar Index (it measures US dollar against a basket of major traditional currencies):

The US dollar appears to be in the process of a typical 5-wave correction, since the early 80s. I believe that the 5th and final wave started at the beginning of 2017. The last wave can often be the most brutal, and I think it will be the case here.

Below, is a comparison of the US Dollar Index and three cryptocurrencies (Dash, Litecoin and Bitshares (the EOS older brother):

Look what happened to the crypto prices after the start of wave 5 (the blue line or point 4). They started to rise and then went parabolic. I believe this to be only the first phase, and when the US dollar continues its collapse, these cryptos will start the second phase to new all-time highs.

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Responses

  1. Tom DH

    Wow, It’s not at all top of mind that investing in cryptocurrency is in fact shorting the USD, or whatever fiat currency is in your fiat to crypto trading pairs. However, the USD is resilient and the politicians and central bankers are clever and the time frame will be stretched out like an old rubber band until it finally snaps many years into the future, perhaps beyond our lifetimes. That is, unless the knife’s edge of crypto snips the ribbon on a new age of decentralized peer to peer cash systems leaving the banksters befuddled and tied up in knots.

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  2. Workin2005

    Nice post. I agree…when the dollar collapses, people will turn to the usual precious metals…but there’s now a new asset class called crypto. It’s not only a hedge against inflation, but, unlike gold/silver, it’s able to function as an actual currency. It doesn’t need to be stored in a vault or melted down to a particular weight. This is game changing and may lead to TRUE financial freedom for billions of people.

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  3. Dale Brosius

    Very interesting read. I have been looking into the correlation of emerging markets and the crypto space. The only issue I really have with this analysis is that the US dollar is only one country and crypto is world wide. It’s easy to imagine the US dollar would have an impact on crypto but that big of an impact? I mean if US dollar goes down it means other fiats are going up, seems like their would be a lot of off setting.

    Could it be that the US dollar dropping correlates with emerging markets rising and thus having more money to put into crypto?

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  4. cryto-Analyst

    Interesting. Who cares about the dollar. US wants to be last for safety reasons. Whether dollar collapse or not the technicals set the market with selling and buying pressure that predicts where the market is headed with hopefully minor manipulation. Good information.

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  5. peter S

    I don’t want to spoil the party but don’t forget millions got burned in the last peak Jan 2018 and many will be hesitant to go back in. But the dollar will collaps eventually. Too much debt in USA.
    Let’s see what the future holds.

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  6. CryptoCosmonaut

    These are the days of history in the making and we are living them out in the here and the now. Ahhh! The tangible of the precious metals. Especially silver is my favorite. It’s a picture of redemption along with the royalty of gold. Although I had been concerned of a mad Max situation brewing in the years I had come to the knowledge of central banking and fractional reserve lending and the debt based monster of consumption.
    I didn’t meet sAtoshi and understand their protocol much more than a year ago. Now with a mere hiccup at this point, the legacy system and Fiat and digital have an infrastructure to flow and bring the greatest wealth transfer in history.
    Great article too inspire!
    BTC Gold LTC Silver EOS Digital Cash
    #litecoinmichel #michaeleos

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  7. Santi

    It is clear that the rise of crypto currencies will inversely correlate to the collapse of fiat currencies. It is just a matter of which crytos survive and when will that process start.
    Good post!

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  8. Dale Brosius

    Yeah U.S dollar is still 62% of the World Reserve but it has been falling almost every quarter and will continue to fall as the U.S dollar loses value so naturally the dollar will fall down further and further and be less impactful world wide. Of course that means other currencies gain value and can afford more crypto with the same money so it would seem that it’s just all intertwined. Which just makes the whole process of the dollar falling that much more impactful on cryptos rise.

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  9. SouthernCrossroads

    Thanks for the message about the piece. I found it to be informative, and I think you might also look at a piece I submitted.

    https://trybe.one/does-crypto-fit-the-definition-of-money-or-does-crypto-expand-it/

    I think that crypto will become a new currency class that derives value from its utility as an intellectual property. I don’t see the market collapsing to a single currency but it will become a basket of currencies that exchange through trading pairs. In the short term we are possibly shorting the dollar, but in a larger scope I think this will redefine how we see the function of currency, and may even reevaluate the institutions we have deemed necessary to create and distribute currency.

    This idea has the possibility to redefine the world.

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