This Scary Fractal Suggests Bitcoin Price Is On Its Way to $3,000

Over the past few weeks, Bitcoin (BTC) has been consolidating in the range around $7,000, seemingly stuck in between a rock and a hard place. Indeed, the cryptocurrency has many times bounced in the mid-$6,000s, where there is macro support, and has been rejected multiple times in the resistance band around the high-$7,000s.Related Reading: Why Bitcoin Is Poised to Rally 25%, Spring Past $9,000 In Coming WeeksAccording to an eerily accurate fractal pointed out by a cryptocurrency trader, Bitcoin will need to break higher soon, or else a strong drop towards the $3,000 range may soon take place.Bitcoin Fractal: BTC Prime to Fall to $3,000Cryptocurrency trader Mr. Chief recently posted the below tweet, noting that Bitcoin’s price action since the start of 2019 is eerily reminiscent of the chart of the stock of AMD from 1991-1992. Both charts, he pointed out, saw a strong rally higher, a parabolic peak, a consolidation defined by a descending triangle, a fake breakout above the hypotenuse, and an inverse head and shoulders — a classical bottoming pattern.In the case of AMD, its price broke below the inverse head and shoulders pattern, plunging by 50% in the weeks that followed.The fate of Bitcoin’s inverse head and shoulders pattern is currently undecided. But if it follows AMD, the price of the cryptocurrency will collapse towards $3,000 in a rapid amount of time, likely creating an extended bear market phase that will ruin bulls.$BTC ThoughtsLow time frames look decent for a bounce. Personally, I really want to see a follow through on this IH&S in the very near future. If not, I think momentum could run dry very quicklyBe careful folks. Still at resistance. Don’t get too cocky about this move…yet pic.twitter.com/8Wa4r6xcxK— Mr Chief (@HaloCrypto) January 3, 2020The fractal’s directionality lines up with the on-chain data which suggests that Bitcoin investors have yet to complete a historical trend seen in any full-fledged bear market.Per previous reports from NewsBTC, the SOPR (Spent Output Profit Ratio) indicator — an indication of the average Bitcoin holder’s profitability — suggests  Bitcoin has not yet seen a capitulation event for the current cycle, implying that the crypto market could see one strong dip before a return to a bullish phase.Related Reading: Why Bitcoin Investors’ HODL Mentality Means a Price Surge Is ComingThe Bull CaseBears may be in control of the narrative due to Bitcoin’s performance over the past few months, but a growing sentiment is that BTC upward breakout is imminent.Su Zhu, the chief executive officer of forex and crypto fund Three Arrows Capital, recently remarked on Twitter that he believes Bitcoin’s price outlooking heading into 2020 is looking rather bullish. The prominent commentator specifically cited  his analysis of the BTC/USDT trading pairs and their premiums to BTC/USD markets and the overall price action, which shows there are “clear signs of accumulation and money flow back into risk.”BTC/USDT premiums and price action show clear signs of accumulation and money flow back into risk.Would not surprise me to see 9K+ before end of Jan.— Su Zhu (@zhusu) December 28, 2019And also, analysts like Velvet and Financial Survivalism have suggested BTC is currently in a textbook Wyckoff Accumulation pattern. Per the pattern, Bitcoin is in its final shakeout lower, evidenced by the drop to the $6,800s.So should this textbook technical analysis pattern play out exactly as the studies of Richard Wyckoff, a noted technician, says, BTC is likely to break $9,000 and maybe $10,000 by the end of January.Related Reading: Bitcoin Poised to Collapse Under $5,000? Market Cycle Fractal Suggests SoFeatured Image from Shutterstock

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