3 Historical Bitcoin Price Charts Show What’s Happening!

According to crypto analyst Yashu Gola, the fundamentals accompanying previous Bitcoin bear markets are completely different from 2022. However, it risks the recovery for Bitcoin price. Many analysts looked at Bitcoin’s sideways trend as a sign of a potential market floor. He also made comparisons from previous bear markets that showed similar price behavior before BTC’s sharp upward turns. Yashu Gola capitalizes on three striking precedent trends that precede past market floors.

Bitcoin price 2018 sideways trend

The Bitcoin bear market of 2018 has eerily exemplary price trends and indicators. In this respect, it sees a valuable hint mission for a potential market base in 2022. One key indicator is Bitcoin’s 200-week exponential moving average (200-week EMA; blue wave in chart below). In 2018 and 2022, Bitcoin entered a long period of side consolidation after closing below its 200-week EMA.

BTC weekly price chart with 2018 bear market fractal / Source: TradingView

Bitcoin’s sideways trend lasted 11 days, excluding 2018. The price retraced its 200-week EMA as reinforcements. Subsequently, in June 2019, it moved to approximately $14,000 without errors. In 2022, the sideways trend entered its 19th day on October 28. However, a clear break above the 200-week EMA near $26,000 is expected.

Additionally, Bitcoin’s weekly relative strength index (RSI) points to a potential bottom formation. In 2018, the fall of the RSI into the multisold zone (below 30) was followed by BTC’s sideways trend and finally a full-fledged bullish reversal. This is halving to the Bitcoin RSI trend of 2022, given that it dropped below 30 in June and followed Bitcoin’s sideways price action mid-$18,000 to $20,000. If the 2018 fractal repeats, it is possible that this uptrend would rather follow the reversal phase.

2013-2015 bull trap support

Bitcoin’s 2022 bear market shares similarities with the price trends witnessed in 2013-2015, consisting of a descending trendline resistance, a weak bull-trap underlying trendline, and a horizontal support level.

BTC weekly chart with 2014-2015 bear market fractal / Source: TradingView

BTC is down 82% from its December 2013 high of $1,200. In doing so, Bitcoin tried to close three times above the descending trendline resistance. They are marked with A, B, and C in the chart above. Simultaneously, the price caused bull-trap rallies with finite support from another descending trendline.

Bitcoin finally bottomed out at a horizontal trendline reinforcement near $200. It subsequently had a strong break above the descending trendline resistance. Thus, it reached the $0.236 Fib line at $429. By December 2017, its price had reached nearly $20,000.

Bitcoin 2013–2015 bear market on weekly chart / Source: TradingView

Koindeks.comAs you follow, in 2022 Bitcoin ticked all the boxes to reflect the 2013-2015 bear market, except for the break above the descending trendline resistance.

Bitcoin 2022 bear market on weekly chart / Source: TradingView

Therefore, if a breakout occurs, a false rally to $30,000 from the 0.236 Fib line in early 2023 is possible.

Bitcoin MVRV-Z score

According to the on-chain analysis perspective, Bitcoin’s 2022 bearish trend has rendered it priceless, as it did at the end of previous bear markets. For example, Bitcoin’s Market Value Realized Value (MVRV) Z-score, which measures the over/under cost of crypto relative to its ‘fair value’, has fallen into the region corresponding to previous bear market bottoms, as shown below.

Bitcoin MVRV-Z Score and market bases / Source: Glassnode

The on-chain indicator increases the possibility of Bitcoin hitting bottom in the $18,000 – $20,000 region in line with the top two fractals.

Is it different this time for Bitcoin price?

Unlike previous years, Bitcoin’s 2022 bear market was mainly caused by interest rate hikes by the Fed, always in response to high inflation. The Fed’s tightening measures removed the excess cash in the economy. This allowed investors to speculate on risky assets with little capital.

As a result, BTC fell next to US equities with a strong correlation coefficient of 0.80 as of October 28. Previously, the Bitcoin market recovered weeks or months after its correlation with US equities dropped below zero. The chart below shows four examples from 2014–2016, 2017–2018, 2019–2020, and 2021.

BTC weekly price chart / Source: TradingView

Therefore, if its correlation with US equities remains positive, BTC risks bearish reversal.

CME Bitcoin option location distribution / Source: Ecoinometrics

“Traders see the possibility of Bitcoin slipping to $10,000 to $15,000,” said Nick, Ecoinometrics information resource analyst. But they see a lower probability of going lower than that,” he said. In the middle, over 2,000 CME Bitcoin options contracts expiring later this year show a clear bias towards sell positions. In other words, traders expect further declines for the BTC price.

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