Fractal Analysis: Bitcoin Will Undergo a Slight Correction Towards $11,000
- Bitcoin may not sustain its highs after pushing as high as $11,500 on Friday evening.
- One trader recently noted that a simple fractal analysis suggests the coin will undergo a retracement after hitting $11,400.
- The trader said that the cryptocurrency has some similarities to price action around two weeks ago.
- While the fractal may be valid in its own right, the discussion around the next fiscal stimulus bill in the U.S. is likely to drive Bitcoin’s price action in the near future.
Bitcoin Could Drop, Fractal Analysis Suggests
Bitcoin could drop from current levels by a few percent if it is to follow a fractal observed by a cryptocurrency trader.
The trader shared the chart below on October 11th, noting that there are clear similarities between the price action in late September to that seen over the past few days. This fractal suggests that there will be a “standard Sunday dump,” likely towards the low-$11,000s.
Chart of BTC's price action over the past few weeks with analysis by crypto trader Steve (@TheTradingTramp on Twitter). Chart of TradingView.com
Stimulus Talks to Drive Price Action
While the fractal may be valid in its own right, the discussion around the next fiscal stimulus bill in the U.S. is likely to drive Bitcoin’s price action in the near future. After all, much of the recent price action in BTC’s price, including the ongoing rally, has been fueled by expectations of another stimulus.
Unfortunately, it was recently revealed that “House Speaker Nancy Pelosi and Senate Republicans on Saturday balked at President Donald Trump’s roughly $1.8 trillion stimulus proposal.”
Further delays to the stimulus bill passing may drive the U.S. dollar higher relative to other currencies. This, in turn, will force Bitcoin lower as the cryptocurrency is seen as a hedge against fiat stimulus and inflation.
Photo by Taylor Deas-Melesh on Unsplash Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com This Trader Fears Bitcoin Will Undergo a "Standard Sunday Dump"