Bitcoin is up 70% from its November low despite fears of a rate hike thanks to expectations of ETF approval. Cointelegraph analysts presented several scenarios for further price dynamics.
Previously, bulls had to retreat from the psychological level of $30,000. This turn of events has many traders wondering if the price will collapse again in the coming months, despite the upcoming halving in April 2024.
From the point of view of fractal analysis, such a scenario is not excluded. Experts set the target at $21,500 (-17.75% of current values).
The nature of the current movement “copies” what happened in 2018 – both then and now quotes have stabilized near the 0.236 Fibonacci correction level. The previous time, after consolidation, prices touched the uptrend line. If repeated, Bitcoin may fall in price to the level indicated above.
Analysts cited the strengthening of the dollar as an additional argument. The US currency index DXY has reached its highest since November 2022. The chart below shows the dollar’s negative correlation with Bitcoin throughout 2023.
DXY continued to rise for the 11th week in a row after the decision Fed leave the key rate unchanged on September 20. On the chart, the prerequisites for the formation of a “golden cross” appeared – the intersection of the 50-day and 200-day SMA from bottom to top – a strong bullish signal.
What on-chain indicators say
According to analysts, on-chain metrics paint a mixed picture.
The Coin Days Destroyed indicator, which takes into account the movement of the “oldest” coins, rose sharply on September 19. In other words, some hodlers have moved their coins, which may indicate they are preparing to take profits. Experts emphasized that such a pattern often occurred before prices fell.
Experts also drew attention to the reduction of coins on the balances of centralized platforms. Such dynamics indicate a growing tendency towards “hodling”.
Trader Skew noted low “trading density” below $27,000, which could lead to a breakout of this level.
lol https://t.co/xlWnrxLmTD pic.twitter.com/kPPKlfLj0Z
— Skew Δ (@52kskew) September 27, 2023
An analyst at Rekt Capital predicted a correction to $18,000. He based his forecast on a fractal that he discovered before the previous halving.
“History shows that the next 140 days will be critical for DCA in preparation for a parabolic rally after the halving. If the first cryptocurrency is going to roll back, then most likely this will happen within the specified period,” – commented the specialist.
History suggests that the next 140 days will be crucial for dollar-cost-averaging in preparation for the Post-Halving parabolic rally
— Rekt Capital (@rektcapital) September 27, 2023
Prior to this, Cointelegraph experts doubted that the “golden cross” in the dollar index would create problems for Bitcoin.
Let us recall that against the backdrop of the stability of the first cryptocurrency, the correlation of digital gold with the US dollar dropped to zero, and with the leading stock indices it became slightly negative.
Previously, BitMEX co-founder Arthur Hayes admitted a possible short-term drop of Bitcoin below $20,000 followed by a new bullish impulse. However, in September, he pointed to the positive prospects for the first cryptocurrency, contrary to the Fed’s policy.
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