Bitcoin is in consolidation mode after one of the largest quarterly earnings ever. All signs suggest there is even more upward movement left in this bull run, but according to a fractal found during the last major market cycle, a sudden series of lows is possible before the bulls regain control.
Here’s what to expect for price action if this ultimately bullish fractal is a valid roadmap of things to come.
Be ready to buy the dip if the fractal formation is accurate
Bitcoin price is still trading $ 10,000 below its 2021 peak, but since last night’s daily close, the bulls are suddenly starting to make a comeback.
But before new highs are reached, a sudden and sharp series of lows can clear long positions from the past few weeks. The warning stems from a fractal found during Bitcoin’s last major bull run, in 2017.
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The shakeout move came after a new record was ever set and long in the rear view, just like the current lineup. It also progressed from under $ 2,000 to nearly $ 20,000 each historic rally mint.
Visually, the price action is strikingly similar | Source: BTCUSD on TradingView.com
Comparing The Bitcoin Fractal Before “The Point Of No Return”
Compare the fractal with the current price action side by side, the similarities are easily visible. A large, sharper spike starts the downward price action and subsequent spikes each get smaller in size. After the fourth try, bears pull out the heavy artillery and push price action through support.
The move would free the market from over-eager traders who got into position too early, taking advantage of the market’s exuberance.
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And just as sentiment turns into extreme fear, leaving investors wondering how deep the violent decline will go, a V-shaped recovery takes Bitcoin to just one more major correction before entering the ‘top’ of the cycle bear market begins.
The fractal appears to appear at the “point of no returnFor Bitcoin, just before the last push to the top. The most directly matching fractal is found during the 2017 rally, but even mid-2013 is consistent with the pattern, albeit a much more volatile structure.
Is this the last major shakeout before $200K BTC? | Source: BTCUSD on TradingView.com
If the volatility in each of these patterns is reduced every time, this last instance of the fractal cannot produce such violent results.
Be that as it may, buying the dip where the bottom of this current correction is located could produce life-changing wealth.
Featured image from Deposit Photos, Charts from TradingView.com