【Dog Farm Pubic Hair Theory】Why is BTC said to be like a wash sale?

┈┈➤刻舟：Almost identical to April~June 2021

Looking at BTC's monthly chart, this October to December is just too much like April to June 2021.

In contrast, it looks nothing like November 2021 to January 2022.

┈┈➤The logic behind it: The difference between unloading and wash sales

The main force (the market maker) should ideally unload gradually, as incremental unloading allows retail investors to catch the falling knife.

However, rushing to unload creates a more ideal panic effect, especially when crashing down to the bottom, as retail investors are reluctant to buy and may even sell.

2021 is the best example, with the two patterns of April~June 2021 and November 2021~January 2022 being completely different.

┈┈➤Game against market expectations: Four-year cycle and interest rate cut cycle

╰┈✦Combining with the tail end of the four-year cycle makes the crash more effective

Especially when coinciding with the end of the bull market in the four-year cycle, the effect is even better.

You should know that the four-year cycle is almost common knowledge. Everyone has bought various coins and is waiting for a pump; if the market maker pumps now, wouldn't he become the one catching the falling knife??? He's not stupid!

So at this time, crashing the market makes most people think the bull is over, even causing some to cut losses and exit. Then, it pumps again, creating FOMO among a portion of people. This should be the normal thinking of the market maker, right?

╰┈✦Welcoming the liquidity easing cycle

Especially knowing that the Federal Reserve will officially enter the easing cycle in 2026 (intermittent rate cuts also count as an easing cycle, as quantitative tightening has completely stopped, and with rates lowered further, liquidity will be even more loose), this does not conform to a bear market environment.

So a quick crash serves two purposes: to induce panic selling among retail investors for the main force to accumulate, and to allow the bear market to finish quickly in order to welcome a new round of easing.

┈┈➤Final Words

Of course, don't be too optimistic about rate cuts. It is highly likely that there won't be continuous rate cuts in 2026, but rather intermittent ones, so even if it doesn't conform to a bear market environment, it seems it also doesn't fit a bull market environment.

Lastly, I want to mention that Bee Brother's analysis isn't necessarily correct. Bee Brother's characteristic is strong logic, but the downside is that he often doesn't consider issues comprehensively and tends to overlook some factors. This is just how he thinks and writes, and everyone is welcome to discuss together.