Bitcoin (BTC), the biggest cryptocurrency by market capitalization, has confronted a setback in its current features after failing to consolidate above the $27,000 stage. With no optimistic macro information to drive BTC past higher resistance strains, trade specialists are searching for a chart evaluation that means BTC could also be on the verge of a major transfer towards $20,000.
This potential lower cost level may function a brand new larger low in Bitcoin’s 1-week chart, paying homage to its trajectory in 2019 earlier than the halving occasion.
Bitcoin Chart Flashing Pink
Crypto analyst Rekt Capital not too long ago shared a chart on X (previously Twitter) outlining Bitcoin’s potential downward trajectory. In keeping with Rekt Capital’s evaluation, Bitcoin could revisit the $20,000 mark, establishing a brand new larger low on its 1-week chart, mirroring the value motion noticed in 2019 earlier than the halving occasion.
Rekt Capital highlights the importance of a revisit to the Macro Greater Low within the present cycle, which may happen in early 2024, coinciding with the halving 12 months. Within the four-year cycle, this could signify that the draw back wick of Candle Four would kind a Macro Greater Low relative to Candle 3, as seen in one other chart shared by Rekt beneath.
Whereas some argue that one other drop into the Macro Greater Low is unlikely because of the COVID-19 crash in March 2020 as a black swan occasion, Rekt Capital emphasizes that the magnitude of a possible upcoming drop could differ significantly.
The COVID-19 crash resulted in a 72% drop from the 2019 native prime to the March 2020 larger low. Nevertheless, if the 2023 native prime have been round $31,000, it will solely require a 37% drop to revisit the upper low.
Whereas a repeat of the -72% crash is unlikely, Rekt Capital means that Bitcoin may retrace -37% while not having one other black swan occasion.
With Bitcoin being 210 days away from halving in April 2024, Rekt Capital parallels the 2019 cycle, throughout which BTC skilled a reduction rally earlier than forming one other decrease excessive.
Throughout, Bitcoin seems to be experiencing an identical reduction rally. Rekt Capital means that Bitcoin could not want a drastic crash or one other black swan occasion over the next months to succeed in its Macro Greater Low on this cycle however slightly a retracement of roughly 27% from present costs.
At the moment, the biggest cryptocurrency out there is buying and selling at $26,600. Regardless of experiencing a retracement beneath the $27,000 stage, Bitcoin has achieved a slight revenue of 0.7% inside the 24-hour.
As highlighted by Rekt Capital, it stays unsure whether or not Bitcoin will comply with the trail noticed in 2019. Nevertheless, what is obvious is that the BTC market is exhibiting indicators of stagnation, with a possible value breakout looming on both aspect.
Featured picture from iStock, chart from TradingView.com
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