2019-12-9 15:10 |
The Bitcoin price has been increasing since reaching a low of $6,616 on Nov 25. Comparing to the fractal from the December 2018 bottom, the current price would be currently in the accumulation phase prior to a breakout.
While the market outlook for Bitcoin has been mired in indecision, the fundamental outlook has been positive. Bitcoin just reached a new milestone with an all-time high for total addresses. This is a very common measure of a network’s growth. Bitcoin now has 28.39M addresses holding BTC.
However, the price is at a very different position relative to that in January 2018, when it was at an all-time high. Crypto trader @canteringclark noted the resemblance between the current Bitcoin price movement and that after the $3,300 bottom in December 2018.
There is an uncanny resemblance between these two charts.
It would make sense that after the first major move up, that the first major correction and following accumulation period would have a fractal resemblance to the larger original.
The purpose is still the same.$BTC pic.twitter.com/eRQA9PRJSZ
— Cantering Clark (@CanteringClark) December 9, 2019
In the fractal, the $3,300 bottom coincides with Nov 25 in the current timeline, projecting a breakout sometime around Dec 11-13.
Let’s take a closer look at the price movement to see if we can expect another iteration of the previous pattern.
2018 Bitcoin MovementIn December 2018, the price underwent a rapid decrease from $6,400 to a low of $3,210 on Dec 15.
Near the low, it created a descending wedge before eventually breaking out. After the breakout, it retraced to the 0.786 fib level before starting a gradual increase.
After a period of 138 days, the price broke out above this trading range in the beginning of April.
Current MovementIn the current cycle, the price initiated a rapid downward move that took it from $8,200 to a low of $6,618 on Nov 25, 2019.
Afterward, the price began to create an inverse head and shoulder (H&S) pattern, which caused it to eventually break out. After retracing to the 0.618 fib level, the price began its gradual increase.
Today would coincide with day 18 of the fractal.
SimilaritiesThe two cycles have many similarities, even though they are transpiring in different time-frames. Both movements followed similar steps:
Low is reached Strong upward move Gradual retracement Pump Accumulation BreakoutStep 6 has yet to transpire in the 2019 movement. It seems that BTC is now in the accumulation phase.
This view is supported by a bullish cross between the 100 and 200-period MAs, albeit in different time-frames (2 and 12 hours).
Future BTC TrajectoryIn the 2018 movement, the breakout took the price the entire height of the previous trading range, measuring from the $3,200 bottom to $,4400 — the height of the first breakout. Relative to the previous downward move, this was a retracement to the 0.786 fib level.
In the current movement, a breakout the entire height of the previous trading range would take it to $8,750. This, however, is higher than the starting price of the preceding downward move and is the biggest difference between the two patterns.
To conclude, while there are several similarities between the two movements that suggest the price will undergo a similar path, they are sufficient to confirm these movements are identical.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images courtesy of Twitter, TradingView.
The post Bitcoin 2018 Fractal Suggests Price Is Accumulating Before a Breakout appeared first on BeInCrypto.
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