Bitcoin (BTC), the most important cryptocurrency by market capitalization, has confronted a setback in its current positive aspects after failing to consolidate above the $27,000 stage. With no optimistic macro information to drive BTC past higher resistance traces, trade consultants are on the lookout for a chart evaluation that means BTC could also be on the verge of a major transfer towards $20,000.
This potential cheaper price level may function a brand new increased 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 might revisit the $20,000 mark, establishing a brand new increased low on its 1-week chart, mirroring the worth motion noticed in 2019 earlier than the halving occasion.
Rekt Capital highlights the importance of a revisit to the Macro Increased 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 4 would type a Macro Increased Low relative to Candle 3, as seen in one other chart shared by Rekt under.
Whereas some argue that one other drop into the Macro Increased Low is unlikely as a result of COVID-19 crash in March 2020 as a black swan occasion, Rekt Capital emphasizes that the magnitude of a possible upcoming drop might differ significantly.
The COVID-19 crash resulted in a 72% drop from the 2019 native high to the March 2020 increased low. Nevertheless, if the 2023 native high 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% with no need 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 aid rally earlier than forming one other decrease excessive.
Throughout, Bitcoin seems to be experiencing an analogous aid rally. Rekt Capital means that Bitcoin might not want a drastic crash or one other black swan occasion over the next months to succeed in its Macro Increased Low on this cycle however somewhat a retracement of roughly 27% from present costs.
At the moment, the most important cryptocurrency out there is buying and selling at $26,600. Regardless of experiencing a retracement under 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 worth breakout looming on both aspect.
Featured picture from iStock, chart from TradingView.com
