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Bitcoin Fractal That Crashed BTC/USD by 50% Flashes Again in 2021

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Bitcoin is showing signs of replicating its trend from 2019 that crashed its prices by more than 50 percent.

According to a fractal first spotted by TradingShot, an independent trade analytics firm, the flagship cryptocurrency’s downside correction move from its recently-established record high near $42,000 is very similar to its plunge in June 2019. That risks putting BTC/USD en route to deeper price levels in the monthly sessions ahead.

“Notice that both 2019 and today’s Parabolic Rises share a few common characteristics,” said TradingShot analysts in a note published Wednesday.

“Both rose by approximately +385% from the time they last made contact with their 1D MA50 until their respective peaks,” they added. “Both pulled-back from their peaks by approximately -30% on the low before contact was again made with the 1D MA50. At the time of the 1D MA50 test, the RSI was on the Support Zone.”

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Bitcoin 2019 and 2021 price moves comparison. Source: BTCUSD on TradingView.com

Bitcoin tested the 50-day moving average as support on Wednesday as its price slipped below $30,000. The cryptocurrency retraced its way to the upside upon facing a comparatively higher buying pressure. Nevertheless, its bullish bias appeared limited owing to a stronger US dollar, reiterating TradingShot’s fears of a 2019 fractal-repeat.

The firm said BTC/USD would need to hold above 50-DMA if it wants to keep its bullish outlook steady. But if the pair breaks bearish on the support, then it risks falling to the next moving average in the queue—the 100-DMA. As of now, it is sitting near $23,000, down 45 percent from Bitcoin’s record high near $42,000.

Meanwhile, if BTC/USD stays above the 50-DMA, its likelihood of continuing its rally back towards $40,000 and beyond would increase.

Converging Bitcoin Indicators

The TradingShot’s 2019 fractal theory matches bias with other technical indicators that, too, point at a further bearish breakdown in the Bitcoin market.

For instance, BTC/USD is fluctuating inside what appears to be a Descending Triangle. Chartists perceive the pattern as a bearish reversal indicator at the end of an uptrend. Typically, the Descending Triangle’s downside target is as much as the maximum distance between its upper and lower trendlines.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT

Bitcoin Descending Triangle breakdown warns about a correction to levels below $20,000. Source: BTCUSD on TradingView.com

In Bitcoin’s case, that distance is nearly $13,000. That puts the cryptocurrency en route to its 200-day moving average that sits near $17,000.

The Bullish ‘What If’

Meanwhile, Jonny Moe, an independent market analyst, notes that the Descending Triangle could also shapeshift into a Falling Wedge pattern, which is bullish.

“I don’t think this is what we’re in for, but it’s at least worth acknowledging, the bull case here is that this isn’t a giant descending triangle, it’s some sort of falling wedge type pattern that would form a bottom basically right about where we are now,” he said.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT

Bitcoin Falling Wedge patterns points at a bullish breakout. Source: BTCUSD on TradingView.com

In either case, it appears Bitcoin would retest the 100-DMA as suggested by TradingShot.





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Shark Tank Investor Shifts Portion of Portfolio To Bitcoin and Ethereum

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Although Bitcoin couldn’t hold above the $1 trillion market cap for very long, doing so in the first place might have been a turning point for even the most skeptical investors. It has even caused one Shark Tank investor to change his tune, shifting a portion of his portfolio into the highly volatile asset. Here’s how else the cryptocurrency asset class has been able to turn other high-wealth investors from naysayers into believers.

ABC’s Shark Tank Investor Kevin O’Leary Allocates 3% Into Bitcoin And Ethereum

Cryptocurrencies like Bitcoin and Ethereum are extremely volatile compared to traditional asset counterparts. That volatility has kept Shark Tank investor Kevin O’Leary from making a bid on the asset class for years, aside from a small purchase he made on Coinbase in 2017.

RELATED READING | ONE YEAR LATER: BITCOIN EMERGES AS “THE STIMULUS ASSET”

Over the last few years, the affectionally-dubbed “Mr. Wonderful” has appeared on CNBC blasting the asset class as “garbage,” but he’s now bought into weighted bucket of Bitcoin and Ethereum with at least 3% of his portfolio, according to a recent segment.

O’Leary says that the volatility the asset class is notorious for still “sickens” him, but that he’s “getting used to it” and thinks that crypto is “here to stay.”

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The rise of Bitcoin and Ethereum over the last year has been undeniable | Source: BTCUSD on TradingView.com

Crypto Wins Over Mr. Wonderful, What Happens When The Feeding Frenzy Begins?

O’Leary is a mainstay on ABC’s Shark Tank, alongside other wealthy entrepreneurs and investors such as Robert Herjavec, Lori Grenier, and Mark Cuban. Cuban, another crypto pundit who once said he’d rather have bananas than Bitcoin, has also recently come around to the asset class.

Cuban hasn’t necessarily given much support to Bitcoin itself, but has recently dabbled in NFTs in recent months.

RELATED READING | FAMED INVESTOR, BLACK SWAN AUTHOR IS “GETTING RID OF” HIS BITCOIN, HERE’S WHY

Bitcoin and Ethereum, have grown enormously in ROI, market cap, and adoption. The pandemic and resulting stimulus-related money printing propelled the digitally scarce asset with futuristic, decentralized use cases into the forefront of finance, and since then, no one can deny their relevancy and potential.

With that widespread realization that these technologies are “here to stay” as O’Leary said, there’s a mad dash to buy in now rather than paying increasingly higher prices later on. High wealth individuals like O’Leary, whose net worth is reportedly around $400 million are only just starting to allocate 3% of their portfolios and look what how much the asset’s price has appreciated.

What will the result be when large portfolios are crypto-dominant? It is a future that’s hard to imagine for the time being, but as the asset class has shown its transformative potential has nowhere nearly been tapped, and is only just beginning to show what it is capable of.

Featured image from Deposit Photos, Charts from TradingView.com



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More Bitcoin! Michael Saylor’s MicroStrategy just keeps buying BTC

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MicroStrategy’s Bitcoin (BTC) buying spree shows no signs of slowing, after CEO Michael Saylor announced the purchase of another 328 BTC on Monday. The acquisition, which was paid for in cash, cost the firm around $15 million, and equated to an average coin price of $45,710 at the time of purchase.

The investment takes MicroStrategy’s total Bitcoin holdings to 90,859 coins — a haul worth $4.3 billion based on the current coin price. The firm essentially dollar-cost-averaged into Bitcoin over the course of the past five months, leaving the average price of each of its Bitcoin purchases at $24,063 per coin. Saylor tweeted on March. 1:

The firm first acquired Bitcoin in August 2020 when it made an initial $250 million outlay on 21,454 coins. MicroStrategy continued to buy more BTC at various points towards the end of 2020, eventually accumulating over 70,000 coins by the turn of the year.

In February the business intelligence firm announced that it would raise an additional $900 million for further Bitcoin purchases — a sum which eventually exceeded $1 billion when an additional 19,452 coins were purchased on Feb. 24.

MicroStrategy’s total outlay on Bitcoin stands at $2.18 billion, while current coin prices would value the firm’s holdings at $4.3 billion, meaning the firm would have made over $2 billion in five months were it to sell. However, there is little reason to suggest this will happen any time soon. Saylor previously said buying Bitcoin was one of the firm’s two corporate goals, along with growing its analytics software business.