When I used Google search trends to confirm a buyable breakout and sustainable bottom in Bitcoin (BTC/USD), I created the following hypothesis: “a spike in search interest confirms a strong change in price behavior.” With Bitcoin breaking out again, the hypothesis now looks solid. The chart below shows Bitcoin jumping to a 5-month high that puts a complete reversal of the November sell-off in play.
Source: TradingView
As I explained in my post describing my strategy, I started with a “no regret” position and then planned to buy into any pullback. The subsequent pullback was so shallow, I only managed to buy one more tranche. I am left with just 20% of the total position I wanted to accumulate. I am now preparing to buy at higher entry points in the coming months.
The Google search interest in Bitcoin has naturally waned since the spike higher at the beginning of April. The low range of the new equilibrium looks higher than the previous equilibrium. I interpret this behavior as further suggesting that Bitcoin’s latest bottom is sustainable.
The chart below for Google search trend interest includes a bonus: a comparison with the search term “beyonce.” Beyoncé’s popularity makes the music superstar a great baseline for measuring mass appeal. For more information on how this measurement has proven useful in the past, see “Bitcoin Has Become As Boring As the Beyoncé Baseline.” Until Beyoncé’s latest media splash, the Netflix (NFLX) documentary “Homecoming” from Coachella in 2018, Bitcoin was rivaling surges of interest in Beyonce.
Source: Google Trends
If Bitcoin manages to rival Beyonce’s latest surge anytime soon….watch out!
Be careful out there!
Full disclosure: long BTC/USD