Bitcoin
If History Rhymes, Bitcoin Will See Steep Corrections Before New Highs
Cole Petersen | Nov 16, 2020 | 23:00
- Bitcoin is clearly in a full-blown bull market, with each dip being aggressively absorbed by buyers as it continues grinding higher
- Unlike BTC rallies of the past, this latest one has mainly been a slow grind higher, which is a testament to the crypto’s maturation as an asset
- It has seen a few strong pullbacks throughout the course of this recent push higher, but it is important to note that buyers have quickly reversed all of these
- One veteran trader is now noting that Bitcoin historically sees around 9 strong pullbacks, averaging 37%, during multi-year bull trends
- This means that in the coming months and years, the crypto could see some sharp declines
Bitcoin and the entire cryptocurrency market have been growing stronger and stronger with each passing day.
Bears have tried to gain control of the benchmark digital asset on multiple occasions, but they have been wholly unable to do so.
Where the entire market trends next will depend largely on whether or not buyers can continue shattering the high time frame resistance levels that lie just above where it is currently trading.
One veteran trader is also noting that while Bitcoin has yet to see any sharp selloffs, it is a strong possibility that the cryptocurrency will see some in the months ahead as its macro uptrend continues.
Bitcoin Nears 2020 Highs as Bulls Flex Their Strength
At the time of writing, Bitcoin is trading up over 3% at its current price of $16,420. This is just a hair below its recent highs of $16,500 set just a few days ago.
If it can shatter the resistance at $16,500 and rally towards $17,000, it could be on the cusp of being catapulted to its previous all-time highs.
A rejection here is likely, but it remains unclear how long this level will hold as resistance.
Veteran Trader Claims BTC May See Some Serious Pullbacks
One veteran trader explained that although Bitcoin’s price action is incredibly strong, he believes that the cryptocurrency could see some major pullbacks in the future while still maintaining its bull trend.
He notes that, historically, BTC sees around 9 significant corrections throughout the course of a macro uptrend.
“During the 2015-2017 bull market in Bitcoin $BTC, there were 9 significant corrections with the following averages: 37% decline from high to low. 14 weeks from one ATH to the next ATH. Since the early Sep low there have been two 10% corrections.”
Image Courtesy of Peter Brandt.
This means investors shouldn’t be alarmed if Bitcoin sees a steep correction in the weeks and months ahead.
Featured image from Unsplash. BTCUSD pricing data from TradingView.
