Bitcoin (BTC) price continues into the weekend below $20,000. Those who took short positions during the week were successful in their forecasts. However, a historical Bitcoin fractal shows that the bears’ ultimate target is below $19,000.
Bitcoin price drops sharply
Bitcoin price is currently struggling to break $20,000. The leading cryptocurrency has lost support from the 8- and 21-day simple moving averages this week. This accelerated the sharp 8% drop and counting. We quoted analyst Tony Montpeirous’s setup targeting $18,900 with an entry of $23,125 during the week from Kriptokoin.com. The analyst expected a 20% drop to $20,916 as the BTC price traded above $23,000. After this signal was generated, a fractal wave of Bitcoin’s previous market behavior was applied to measure future market movements.
Bitcoin points to these levels for ok or continuation
Currently, the fractal is relatively similar to the current drop. Therefore, the invalidation point will be bullish targets starting at $27,000 last week. However, it also carries risks like bull traps. Bitcoin price may experience a smart coin liquidity hunt towards the entry level before reaching the intended target area of 18,900.
So the invalidation of the bearish thesis remains the same as last week’s $27,000 thesis until the next announcement. The $19,300 level will be a critical level to watch over the weekend, as the fractal suggests that smart money could be involved for a liquidity hunt near the region. However, the fact that the leading crypto has been on a downtrend for months is driving some investors away from the field.
Why might BTC hodl theory be broken?
Bitcoin’s hodl narrative has been losing momentum over the past few months. The market has shifted in favor of short-term profits and this has negatively impacted Bitcoin’s performance. Especially the ability to achieve medium and long-term goals. Bitcoin’s price action has failed to meet its medium-term targets and has fallen into the lower range over the past six months. This is despite the sharp discounting at that time and heavy accumulation during the downturns. Its increase was relatively limited, followed by more downside.
As a result, long-term owners cannot stay in profit. This result is illustrated by Bitcoin’s 180-day Market Value Actual Value (MVRV) ratio, which has been in negative territory for the past six months.
Bitcoin’s six-month total profit supply is currently in the lower range. The drop during this period confirms that HODLers who bought BTC before are still broke. It also supports the short-term profit narrative, with investors buying near June lows taking some profits recently.
The common narrative when it comes to Bitcoin’s profitability is that short-term gains are more preferable. This result then means that any strong buying pressure over the past few months has been limited to the upside.
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