In the last week, Bitcoin (BTC) has finally been able to achieve returns, raising from the local minimum of $ 9,300 to $ 10,500 at the time of writing.
However, one analyst recently pointed out that this price action only confirms the idea that the cryptocurrency market may soon undergo another adjustment – one that could bring the price of bitcoin down to $ 7,000 for the first time in literally months.
Related Read: Bitcoin Price Can Decay by Monthly Bull Flag
Why Bitcoin Price Can Dip by $ 3000 shows the price of gold (two-day chart) in 2012 to 2013 and the price action of Bitcoin (12-hour chart) from June to now.
As seen below, there are two similarities between the two rankings: a series of lower highs and lower levels, the assets recede after RSI reached "redeeming" levels and clear interactions with ke y Recovery Levels of Fibonacci.
Let's try some fractals. $ BTC vs Gold 2012-2013.https: //t.co/k54dhc1jfE #BTC pic.twitter.com/nRkR2cOyYq
– il Capo Of Crypto ( @CryptoCapo_) September 3, 2019
In other words, the bitcoin price seems to be doing exactly what gold did in 2012 to 2013, which was its peak after the Great Recession.
Capo writes that the whole fractal should come out, which means that BTC will soon lose support at ~ $ 9,500, down to $ 7,200 to $ 7,500 – key support for Fibonacci's rearrangement. That would be a 30% drop from the current level of $ 10,500.
So, if this is finally played, the bottom should be 61.8% of the entire turn ($ 7200-7500), then some consolidation and $ 16-24k in June 2020 (bitcoin half) pic.twitter.com/ybfyH55jO0
– il Capo Of Crypto (@CryptoCapo_) September 5, 2019
Capo is not the only analyst currently expecting bitcoin to potentially cut further. According to Jack, a leading analyst at a trading and analysis group known as Bravado, the most likely scenario for BTC is to "break the path to $ 7,400 in a falling wedge" to the bottom in early November. He points out that BTC is clearly in a downward sloping wedge, suggesting that further correction is entirely possible.
I think this is the most likely scenario for $ BTC
We are dropping our way to 7.4K in a wedge-shaped bottom in early November
From there we push for a break and a choke with full force, going back over $ 10K in late November or December and setting the ATH close to half pic.twitter.com/j5lXXkuqYT
– Bitcoin 𝕵ack (@BTC_JackSparrow) September 7, 2019
But while fractal and technical means point to lower price action, the basics suggest a demand for
Related reading: The Cryptocurrency Peter Schiff says gold is in the early bull market, but bitcoin is a rally against Sucker
As reported by NewsBTC earlier, Adam Back, creator of the Proof of Work protocol on which bitcoin mining is based, recently exposed a number of reasons why BTC is ready to value significantly in the coming years. They are as follows:
- Reduction of the Bitcoin Block Award in May 2020 from 12.5 to 6.25 BTC per Block : In May of the following year the number of coins issued per block (every ten minutes) , will be cut in half, resulting in a negative shock to the bitcoin supply market.
- Geopolitical uncertainty : Venezuela collapsed as the regime managed to inflate the local currency, leading to local adoption of bitcoin and other decentralized forms of money. Recently, Argentina saw its incumbent president Mauricio Macri lose the primary election for the presidency, leading to a collapse of the Argentine peso and the local stock market. Hong Kong is involved in mass protests as China wages trade war with countries. These cases are just one of many that show that the world is fragile and in need of safe haven, whether it is gold or bitcoin.
- $ 17 trillion negative yield bonds : On Friday, Bloomberg reported that the negative – the bond yield situation has just developed. Their report, which cites Bloomberg Barclays Global-Aggregate's bond index, shows $ 17 trillion in negative yields.
- Modern monetary theory (MMT) is becoming a popular trend . Many critics of the theory claim that this will lead to massive inflation, which will increase the valuation of hard money such as gold and potentially bitcoin.
While some of these factors have not yet affected the cryptocurrency markets; others have.
Featured image by Shutterstock