I think a recession will
be a disaster for Bitcoin. An alternative to money is
what Bitcoin can never be. Below $5,000, I think we can
kiss this bull market goodbye. The futures market is there to just
to make sure that Bitcoin fails. Hey, guys. The sponsor of this
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of the most demanding and sophisticated traders. So watch this video and go check it out. The link is in the description below. What’s up, everyone? My name is Jackson
and welcome to another Cointelegraph crypto duel. I’m pleased to welcome back, Alessio Rastani. You may remember him from
our earlier video in November. I could see $20,000 on
Bitcoin by January this year. We’ll also be joined by Zak Mir, who
runs the trading blog Zak’s Traders Cafe. It moves 24 hours a day, seven days a week. It really is a trader’s paradise. How’s it going, guys? Hi, Jackson. Thanks for having me on. Thanks for
having me and Zak, I appreciate it. Thank you very much. I thought, Cointelegraph was
British, but obviously it’s got sort of transatlantic feel to it as well. So there we are. We’re all over the world. Exactly. Yes, exactly. All right. So let’s just hop
straight into the first question. So could you guys give me some ideas
about what you’re bullish and bearish targets are heading into the new year? I guess, Zak, if it’s okay, I’ll start and
then I’ll pass it on to the master. I don’t expect Bitcoin to be above $10,000. I don’t think it’s going
to be above $9,000 either. And I don’t think it’s going
to be below $6,000 either. So I think we’re stuck in the range for
the moment between, I would say, between supports at $6,500 to $6,000 and
resistance at $9,000 to $8,800. So I think it’s that kind of range that
I’m expecting potentially going to be between now and the end of the year. That’s pretty interesting
because the last time that you were on with us, I think you said that in the first
couple of months of 2020 we could see Bitcoin hit $20K. I think there is a very, quite high
probability by December or January we could see $20,000, at least $15,000 to $20,000 range. Do you still think it’s possible? What I said was that if Bitcoin can get
above $10,000 and stay above its October lows of $7,300, it’s quite likely
we’ll get to $14,000. And then if we can take out $14,000,
then yes, very likely we’ll get to $20,000. We have to stay above
the weekly 21 moving average. The moment Bitcoin fell below its weekly
21 moving average, $9,000 probabilities, the odds of a move above $10,000
or even above $12,000-$14,000 diminished significantly. So how did those targets line
up with your target, Zak? I think Allessio is probably micromanaging the
whole thing a bit too much. I think we’ve got the, let’s say for Bitcoin,
we’ve got the backdrop of the late $17,000 peak at $20,000. Then the next peaks
were let’s say $12,000-$13,000. So two thirds of that. We’re now struggling basically at half
of the last peak say $7,500. It’s looking like the law of
diminishing returns rather than anything else. I don’t think there’s any great excitement for
the end of this year or next year. The best you can probably
hope for is the range. I agree with the $6,000 range, but it’s
because everyone in town is looking at $6,000, there was resistance becoming support, but there’s
nothing to stop this market gradually, you know, breaking six, five,
four, three, whatever it is. I mean, it’s a post-bubble situation. So would you say you’re
overall bearish right now? I think I’m bearish largely because the bullish
inputs into this market, which was China, which was Libra, have made
practically no difference at all. And, you know, Libra should
have been the great breakthrough. China saying that, you know, we like blockchain and
we like this and we like that should have been great. It wasn’t. And so, therefore, I’ve got to be bearish with
the news that we have at the moment. The difference between me and Zak is that
Zak looks at the fundamentals, which is fine. I respect that. But I’m not
really that keen on the fundamentals. I’m more of a technicals guy. And I would say that
it’s interesting what Zach says. I do have a chart which
I’ll show you in due course. My overall perspective on Bitcoin, which I’m sure
will come to, but I would say that $5,000 on Bitcoin is a key level for me. And I think if we break $5,000, that’s essentially
the line in the sand for me between bullish and bearish because below $5,000 I think
we can kiss this bull market goodbye. All right, great. So let’s
move onto the next question. Alessio, in our last debate, you talked a
little bit about the wild card theory. Are we still following that plan? Just be clear. Let me just define
what the wild card scenario was. Just like, you know, I drew
this chart back in September. So that’s why it looks a bit weird. The reason is I drew this back in September. Just to show you in
context what I was expecting. I was expecting one of two scenarios,
either a pullback, just that $7,000-$8,000 range, which is the green scenario or a much more
deeper pullback that you can see right there in the red. The red is
the start of a deeper scenario. If wave 1 is completed here, let’s say wave
1 is completed back at near $14,000, then we’re going to see a pullback. In other words, a wave to correction, a wave
to retracement down to the $7,000 to $6,000, maybe even to the $5,000-$8,000 range, as you can
see there, then the C wave of the wave 2 could potentially complete there. And then once the C wave of wave 2 completes,
we’ll start the next wave, the major wave 3 to the upside towards $20,000
essentially and further higher. So it’s $30,000-$40,000, which can
take years to complete. That is the wildcard scenario. My other expectation, my, should I say,
alternative or shall we say second lower probability expectation is this,
the better scenario. I would say this is a lower probability at
the moment, which is that Bitcoin could go all the way down to $2,000 or $3,000. The reason I say this is a lower
probability is because we haven’t broken $5,000. It’s only if Bitcoin falls below $5,000
that I would change my mind. If you still believe the drop from the highs we
made in the summer to now is still a correction, not a bear, not a
bearish downtrend towards $2,000 or $3,000. If that’s your belief that essentially that
is the wildcard scenario we’re dealing with. That is what I’ve been saying.
That is still my primary expectation. I give this a 60 % to 55 %
probability, which means that bearish scenario, the better scenario to $2,000 or $3,000 for me
has a lower probability, slighted lower probability, that’s a 45%. That is basically my point. How do you feel about this theory, Zak? Well, that theory sounds very complex to me. I think the simple charting I do a weekly
update and the simple charting thing at the moment is that I’ve got line of resistance from
June, which was the peak of this year, that’s currently running through
$9,500 on Bitcoin. That’s also where the 200
day moving average is. I would just say up to that level,
they are selling into strength, though you’re standing aside if you’re a bull and basically
you’re waiting for that $9,500-$10,000 area to break. I think that if there is going to be
the big mega bull run at the moment, it would start at $9,500 at the 200
day moving average and break through. And you might wait for $10,000 or
$10,500, ready to wait for $11,000. Even if you’re late on that, once it gets
through that this time it should keep going and then you’ll finally get that
move to $20,000 and beyond. If we’re going to see the next continuation,
the next leg of this rally towards $20,000 or $30,000, if we’re going to see that potentially
in 2020, what we need to see is a period of low volatility. Right now, we don’t have a low volatility. What we’ve had is several at least
a few months of very high volatility. One massive move up, one massive move down. We need this market to stabilize once we get
that low volatility, then we can know what Bitcoin’s going to decide next. And that might actually be the next leg
for a potential leg higher towards $20,000, $30,000. I don’t see any reason why Bitcoin cannot
get to $30,000 and $50,000 in the next few years. I just got to jump in on that. I had the view that when futures, the
futures market was introduced for the Bitcoin at the end of 2017, that would or could have
killed the market because in my view, the gold futures killed a possible rally in gold. Gold is manipulated by big players on the
futures market and Bitcoin has never been the same since the futures
market came through there. And basically, that’s how
this market is controlled. So you have all that, you know,
you have the bullishness that people have. People love it and everything
else, and so do I. But the futures market is there to
just to make sure that Bitcoin fails. Obviously, the central banks are there. The IRS, HMRC, all the other places, all the
propaganda in the media, all of that that is there to kill Bitcoin, any time it gets a
good rally, all that negative, all the force comes in, $7,500, maybe is too bothered, the
authorities keep quiet, but it goes back to $10K+. They start getting excited. If we went to $20K at game, they’d be
saying, you know, you’ve got a hand in your Bitcoin, you’ll be taxed, we
know where you live. It’s gonna be all that sort
of stuff coming back again. It is a renegade product and it has, you
know, the power of the establishment against it. And that is something that you have to
remember, you know, whether you’re a fan of Bitcoin or not. I totally
understand what Zak is saying. I sympathize with Zak’s view because he is
right since the Bitcoin futures came out there. That is essentially was near
the top in December of 2017. Yeah, I do sympathize with it. But all I would say is
we should keep an open mind. And I’m sure Zak would agree with that. I’m a technicals guy again. I’m not a fundamentals person. So I’m going to follow the charts. If I see Bitcoin getting above resistance, if
I see it getting above $10,000 and then getting about $12,000, I don’t see why it cannot
go into the next wave 3 rally towards $20K and then $30K. So I do understand the substance of
Zak’s view, which I do sympathize with. But nonetheless, I’ll go with the charts. I’m still interested in this opinion, Zak, is
do you think the institutions are the only thing that’s keeping Bitcoin down or are
there other factors that you’re also considering? There are plenty of traditional
or smart investors, you know, the professional investors. Big city institutions and stuff like that who
look at Bitcoin and they say this is nothing. It’s not even hot air. I mean, even hot air
has more value than Bitcoin. And, you know, you gotta to
see that they’ve got a point. I mean, for them, all of
this is a complete scam. It’s you know, it’s a
Ponzi scheme type situation. It’s money laundering. It’s everything which is bad in the world. Poverty makes you go bald as well. I mean, just everything that you know, everything
which is bad in the world comes from the crypto area, drugs and
criminality and everything else. And so for them, you know, it’s just you
see an asset which is priced at 7,000-8,000 dollars. Well, you’re just shorting it. Every time it goes up, you lob it down. It’s just like, oh, within
that smash it back. You know, I think we’ve
got to be mindful about. But the credibility of Bitcoin
is, I think, very weak. The credibility of blockchain is stronger, but
even blockchain hasn’t really, you know, it’s a great technology. It hasn’t really been
able to establish itself. The risk, I think, is more within itself as
much it’s within itself as it is with, you know, central banks not wanting
an alternative to money. I mean, an alternative to money is what Bitcoin
can never be can ever be allowed to be that. I don’t think people
understand, that hasn’t sunk in. You can’t have an alternative to
the dollar or to the pound. It cannot be allowed to happen. So it’s difficult enough having an
alternative to a petrol car. You know, electric vehicle that was
controversial enough, that’s taken 30 years. But I think, you know, if there’s any
message that I would give, just remember, fiat currencies are backed by the rule of law,
backed by government, backed by every single Illuminati you can think of. And so to call up Bitcoin
a lot is a punchy call. Just to push back there
on what Zak said there. And I know you don’t want to
stay too much on this subject. But just to push back on Zak there. I don’t believe that all cryptocurrencies
and altcoins are going to survive. I think a lot of them
are going to get destroyed. And certainly we’re going to see a
lot of them get wiped out. But there’s gonna be a
few of them will survive. And I think one of them,
the key candidate is probably Bitcoin. I think it is a generational thing. It’s a technology thing. As technology progresses, as the markets as people
decide what they want to choose to spend with like Bitcoin. Let’s say in five years time or 10 years
time, more and more people, especially the new generation, started to go towards Bitcoin as the
main form of currency, as the main form of transferring money or just as
a mean of currency exchange. I think you’re going to see banks following
suit just like it did with Amazon. Amazon changed the way we shop. Twenty years ago, people would go to
the shop to buy their stuff. Now all the retailers are put
out of business by Amazon. Today we’re still using the dollar. We’re still using the
pound. Talking the majority. The majority of us are still using
the dollar, euro, pound, the main currencies. But I think this is a generational thing. People eventually probably going
to change their habits. Bitcoin could change people’s habits. And instead of using dollar, pound or
euro, they might start using Bitcoin. That eventually is going to shape the way
banks are going to behave as well. And then they start adopting, they may have
no choice but to adopt Bitcoin as well. So that’s just my way of pushing
back there on what Zak said. So political and financial power is
all based around currency, fiat currency. If Bitcoin changed, Bitcoin became the currency,
the Fed would have no power. Interest rates – there’d be no control. It’s a different thing. It’s
not Sears versus Amazon. It is actually the US
government versus the people. And you can’t have the people winning. So it’s a bit like the Brexit debate, we
know the UK can’t even leave the EU. You can’t go against the establishment. The establishment is too strong
in terms of counterfeit currency. Money is the seat of all power. The welfare state, all these other things. It can’t happen. So it’s more likely, let’s
say the Fed might create its own digital dollar. That might happen, but it would do that by,
you know, what would it to get rid of Bitcoin, not in order for it to exist. So I don’t think it’s gonna happen. Well, obviously, we’ll see, we’ll see. But I just don’t know about it. The way I see it, Zak, I mean,
Zak, I do understand where you’re coming from. I understand what you’re saying. What I think is that people’s habits
change, just like people’s shopping habits changed. And so going to retailers
are buying from Amazon. I don’t see why they
won’t change their habits. And I think it’s a matter of essentially
the Fed governments will have to eventually adapt. I think they will adapt
to what people are using. What I think may happen is they may
try to find a way of controlling Bitcoin. I don’t think they’re try to find
a way of getting rid of it. Anyway, that’s what I think. I was watching
an interview of you earlier, Zak, and you said it was in 2018 and you said that for
you Bitcoin was going to become the new gold. It’s become for me the new gold. And I don’t think that’s going to
change as far as investors are concerned. But it seems like you’ve
kind of shifted your position. Have you or and why? I think you misunderstand what I’m saying. I love gold. I love Bitcoin. I love anything which is an alternative
and real estate, anything, which is an alternative to fiat currency . Fiat currencies manipulated and year by year the
dollar in your pocket or the pound in your pocket goes down in value. So anything which is a store of value i.e. gold or real estate is
better than fiat currencies. I don’t like the central bankers. I don’t like the way things are done. I don’t like the way that obviously
the money is stored in banks. And that’s why the government and banks are so
close to each other, because if you have the keys to the money you have power. We’re talking slightly
at cross-purposes here. I want Bitcoin to succeed. But I’m concerned that it can’t succeed because
of the link between a pathway and political power and the banking
system or the financial system. I just don’t see how you can have a
rogue currency as opposed to a central bank currency. So that’s what I’m at. So let’s say you’ve mentioned on your channel
and in our last meeting together that you believe a recession is coming in the next year
and a half to two years, you said. So, do you agree with
this assessment of the market? You think a recession is coming? And what do you think the effect of a
recession will be on Bitcoin and the whole cryptocurrency market? So if I may, if it’s
okay with Zak, I’ll go first. I think a recession will
be a disaster for Bitcoin. Now, I know some people watching this video
probably shaking their head, saying, no, the recession is a fantastic thing. But here’s one thing I will say. We don’t actually know how Bitcoin reacts to
a recession, because in the last recession we had in 2008, Bitcoin did
not even exist at the time. We didn’t have bitcoin in 2007, 2008. So we don’t actually have a precedent. We don’t have some kind of historical precedent for
Bitcoin to see how it behaves in a recession. So what I’m going to say is
pure speculation, but I think it’s probably accurate more or less to say,
look what happened to gold. If there is some similarity between Bitcoin
and gold is that they’re both anti-establishment assets or currencies. If you want to call it that. They’re
both anti-establishment, the same kind of people who went to gold, probably the same people who
like bitcoin, because they are an answer to fiat currency. So often people who don’t like
fiat currency, they go into gold or Bitcoin. But look what happened to
gold in the last recession. It dropped by 30%. Everyone thought that gold is going to go
up massively higher in the last recession, but it dropped and lost one-third of its value. I think the reason why gold went down in
the last recession is for the same reason why Bitcoin will probably go down too. Because as when a
recession occurs, what happens? Bankruptcies occur. So people end up either losing their job,
their wages fall, demand drops, companies go bankrupt, businesses go bankrupt. And again, this causes a perpetual deflationary
tool sort of cycle where essentially governments and individuals need
to raise cash. They need cash to survive. So, again, why? Because people have to pay their bills. People have to live somewhere. And if they’re unemployed, if they lose their
job because of the recession, they need money. They need something to survive on. So what might happen is that individuals
start going into their wallets, the Bitcoin wallets, their cryptocurrency wallets, an, emptying
that out, converting that into Fiat to survive, to live. That’s what the main thing is . For me looks like it could be a disaster
for Bitcoin if a recession occurs, but it might not be a disaster. It’s only a disaster, it’s only
a bad thing if you see it from a short term perspective, because here’s the thing. If you’re watching this video and you’re
thinking, Alessio, you’re wrong, it’s going to be great for Bitcoin. Let’s say I’m right. Let’s say that I’m right
and Bitcoin drops significantly. Let’s say falls at $2,000, $1,000,
isn’t that a bad thing, though? Who would not like to buy? Just ask this question, who would not
like to buy Bitcoin at $2,000,$1,000? You’d have to be crazy to say no. You’d have to be crazy to say no. I don’t want to buy
Bitcoin at $1,000 or $2,000. Crazy. So even if Bitcoin gets
cheaper in a recession, so what? It’s a win win. Not only does Bitcoin get
cheaper, real estate prices get cheaper in a recession to stock prices get cheaper. So I think it’s not bad, I
see it as a glass half full. For me, it’s a glass half full. The first thing is that I’d actually
remember saying that I agree with you. I actually don’t remember agreeing
with you on anything, really. But on the recession side, no, I
think one of my better’n was is the old style economic theory, which I
think ended at the last global financial crisis, 2008. That was the end of
all the economics textbooks. You could throw them out the window
because all the relationships, everything from there doesn’t work anymore, especially
the inverted yield curve. That is like a stop clock, from now on
with very low interest rates and the new environment we have with the QE, etc. It’s a recession is much
more difficult than before. Growth is more difficult and
a recession is more difficult. Inverted yield curve doesn’t predict anything at
all because we’re in a false bond, markets are false, etc. Most of the markets we have zombie companies
with loads of debt and we have false markets. And that way the stock
market is also a false market. It’s just being pumped up by Mr. Trump and his friends. So no recession. If there was a recession, I think we all
we would have actually we’ve got more chance of a depression than a recession. So I think if there was some calamity
and somebody shoots Trump or whatever, it would actually be a 1930s style thing,
but not a year or two. No negative growth, you
know, minus 1 percent. I think we’ll be a
complete, you know, car crash. But basically boom and bust is
over in the new QE environment. What I was gonna say on Bitcoin, basically, I
think if there was that kind of smash, if there was a depression, a bad situation, I
think Bitcoin would be stronger because the establishment would be weaker and it
would be a renegade asset. And I think that we would actually be
positive, which is actually what it is. It’s Bitcoin is good for, you know,
developing world situations where, you know, you don’t have access to a bank. You can pay somebody, you know, off
the record via Bitcoin and everything else. And that is, you know, that’s
what Bitcoin is good for. But as I said, I don’t
think it’s gonna be a recession. I think we’re just pumping up the stock market,
pumping up real estate, etc, and we just keep going like that. Excellent. Thank you guys so much for
coming on the show today. Thank you. Thank you for having us. Thank you, everyone, for watching. My name is Jackson. That was
Alessio Rastani and Zak Mir. And guys always remember to
like, subscribe and hodl.