Bitcoin: ‘Magic’ of the Golden Ratio to the rescue?
It has been more than a month now and Bitcoin, the world’s largest crypto, has remained in the lower $30k to the mid $40k price band. This range is set to be Bitcoin’s “new home” for the next few weeks. Additionally, as our recent analysis pointed out, the crypto asset’s price is set to further consolidate under the $41,500-resistance level.
An “upward rally” or an “uptrend” is something that Bitcoin hasn’t seen over the past few days. Amidst the death cross narrative doing the rounds, the aforementioned phrases have sort of become alienated to the community now. Nevertheless, there is something to cheer about.
The “Magic” of the Golden Ratio
A pseudonymous analyst recently highlighted that after every downtrend (encapsulated within the red region), whenever Bitcoin’s price has shown signs of recovery, it has broken past the 1.0 Fibonacci level (light green line). Next, its price has only surged beyond 1.618 or the ‘golden ratio’ (dark green line). The market has then always used the same level as support to further continue its uptrend.
What’s more, after retesting the aforementioned level, the crypto has always gone to touch its genuine cycle top. Commenting on similar lines, the analyst added,
“Every cycle, Bitcoin recovers from its previous bear market, then exceeds the recovery by 61.8% on the downside (market at 1.618).”
The analyst went on to add,
“Every cycle, after exceeding above the 1.618, BTC has tested this level for support before 🚀 (surging).”
Bitcoin’s price, for now, is yet to successfully sustain a breach of the $40k level. At press time, BTC had fallen by over 4% in 24 hours, with the crypto valued at $35,638.
Interestingly, all the previous sell-offs have eventually pushed Bitcoin towards the golden ratio and the price has been subject to its “magic.” Looking at the prevailing market scenario, Bitcoin has already breached the 1.618-level, as indicated by the chart. Looking at past precedents and keeping the ‘cyclic’ nature of Bitcoin in mind, the odds of an uptrend from this level seem to be quite likely. All in all, the ‘golden ratio’ might act as Bitcoin’s bottom before the next uptrend begins.
Well, even though an uptrend is on the cards, there is no surety of when it will exactly happen. However, the analyst went on to contend,
“This Bitcoin Year of the Bull is not over. Much more to come – and the price will go much higher.”
OhNoCrypto
via https://www.ohnocrypto.com
Lavina Daryanani, @KhareemSudlow