The Bitcoin correction was short lived to say the least. Only three candles closed below $10k on the hourly chart and one briefly dumped to $9,600, 30 percent down from the recent high. Looking at previous market cycles may give us a clue as to when this may happen again … and it could be a while.
Bitcoin Back At $12,000
Over the past 24 hours BTC has marched steadily higher, touching $12,000 again during Asian trading this morning. The move has added another 5 percent to Bitcoin price as it continues to trounce the altcoins, eating into their market share.
Daily volume has dropped a little and is now back below $30 billion but the BTC train looks unstoppable at the moment. At the time of writing Bitcoin was trading at around $11,850, the top performing cryptocurrency in the top twenty.
Looking at previous chart patterns indicates that corrections of this magnitude have occurred eight time during the last uptrend. Calculating the average time between previous pullbacks gives a figure of 98 days so the next one using a similar figure may not happen until November.
“Bitcoin just had its first >30% pullback, down from $13,850. There were 8 pullbacks of this magnitude in the last bull market with an average of 98 days between them. This could be the last dip until November.”
Bitcoin just had its first >30% pullback, down from $13,850.
There were 8 pullbacks of this magnitude in the last bull market with an average of 98 days between them.
This could be the last dip until November.
Chart credit
— James Todaro, MD (@JamesTodaroMD)
Managing partner at Blockheadcap, Matt Kaye, has into the correction stats.
“The previous bull cycle had 8 major pullbacks.
On average, each pullback:
– Retraced 36%
– Lasted 16.3 days
– Reached a new cycle high 55.2 days after bottoming.”
With those in mind the next cycle high could come as soon as September and could well be higher than Bitcoin’s previous peak of $20k. The average gain after those pullbacks has been 153 percent which would put the next high at just over $24,000 – double the current price.
BTC Market Share Hits 65%
Another indicator of Bitcoin’s prowess is its market dominance which has hit 65% again, a level not seen since late 2017. Many are eyeing a climb to 70% which is the share of the market BTC had in mid-2017 before the huge altcoin rally.
Trader and analyst ‘CryptoFibonacci’ has been looking at the weekly dominance chart to spot levels of support and resistance and 70% looks pretty clear.
“This is strong. Either way, it looks like Alts will not have their day for another month at least. That 200 day moving average just overhead should stop this in its tracks for the short term by then. That will give Alts a chance.”
Weekly Domination Chart.
This is strong. Either way, it looks like Alts will not have their day for another month at least. That 200 day moving average just overhead should stop this in its tracks for the short term by then. That will give Alts a chance.
— CryptoFibonacci (@CryptoFib)
The majority of altcoins are still pretty flat during today’s Asian trading session as BTC continues its unrelenting march to the moon.
Image from Shutterstock
