Despite the declining macroeconomic view, Bitcoin has performed very well in recent weeks, rising from the low of $ 3,700 to a high of $ 7,500 just last week. Even after a slight correction, the cryptocurrency remains around 90% higher than when it crashed on “Black Thursday”.
However, some analysts are beginning to fear that bulls have the potential to reverse the trend after the rally pauses.
Bitcoin looks almost the same as it did when it was $ 10,500
Cryptocurrency trader DonAlt recently shared the following tableThis shows that the recent daily candles, while not “super bearish,” are “terribly close to how the $ 10,000 peak developed,” suggesting structural similarities between this timeframe and now.
The asset that follows the game book he created the last time he saw a similar price move will fall off a cliff in the coming weeks and will likely retest lows.
The similarities between the two periods do not stop here.
Cryptocurrency analyst Mayne said Bitcoin is this currently in the middle a rising wedge pattern to print out, which also marked the $ 10,500 peak. Rising wedges are textbook-bearish, which means that BTC could fall from here.
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Different this time?
Given the charts shared by DonAlt and Mayne, it cannot be denied that the current price trend is similar to the peak of Bitcoin in February. But can one say that “this time is different?” Can you say that BTC will avoid these bearish technical factors?
Yes, because there is now a confluence of critical positive technical, chain, and fundamental factors that weren’t there when BTC peaked earlier this year. The factors that could be listed are many, but here are some of many:
- The number of “new entities in the Bitcoin network every day” has increased significantly. The 7-day moving average of the metric, which calculates the number of new users entering the BTC network, rose from 6,000 lows in mid-March to 17,000, an increase of almost 200% in just a few weeks. This is interesting as the metric has not been as high since around April 2019 as the rally started from the low of $ 3,000 and $ 4,000 to a high of $ 14,000 by the end of June.
- According to Skew.com, the value of the total circulating USDT supply after another print series has increased to USD 6.7 billion, USD 2.2 billion higher (or 42% higher) than the market capitalization of approximately 4.5 USD billion in early March.
- In recent weeks, governments and central banks have mobilized more than ever to stop the outbreak of the corona virus and its economic impact. Many say this will be positive for Bitcoin as the cryptocurrency is scarce.
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