Crypto Market Insights: Delve into Bitcoin’s Historical Pattern, Anticipating a Potential Drop Below $20,000 on

The Potential Bearish Fractal in Focus: According to crypto expert Rekt Capital, there is an identified recurring bearish fractal in Bitcoin’s historical price trajectory. This fractal suggests the possibility of a price drop below the $20,000 threshold. The same pattern was observed in 2019 and 2022, and it appears to be resurfacing in the 2023 market landscape.

For those unfamiliar with the concept, fractals in trading help identify potential turning points on a price graph by highlighting repeated price configurations. In this case, a bearish fractal indicates a potential price drop, characterized by a peak price followed by two lower high bars/candles. This pattern typically signals a potential downward price movement.

Decoding the Potential Bitcoin Price Decline:

The core of this bearish configuration begins with a double peak. Contrary to popular belief, confirmation does not come from a drop below a crucial support level. Instead, a relief rally usually occurs, forming a lower peak, before the price plummets below the mentioned support.

This support then transitions into a resistance level, pushing the price further down. This sequence was observed in 2019 and 2022, and the 2023 market seems to be displaying early stages of this pattern. Rekt Capital suggests that we might currently be amidst this bearish fractal, with the endpoint of the relief rally still uncertain.

Between April and the end of August, Bitcoin showcased a double-peak pattern on the weekly chart, with the price remaining above the $26,000 neckline. By mid-August, Bitcoin initiated a relief rally, pushing the price to $28,600. The analyst suggests that we might be in the initial phases of this bearish fractal.

Potential Outcomes and Indicators:

Looking into potential outcomes, the analyst speculates that Bitcoin could potentially rise to around $29,000 before facing further price drops. Key events to monitor include the possibility of surpassing the bull market support band. If Bitcoin fails to retest this band and uphold it post-breakout, the bearish fractal remains in play.

Another crucial aspect is the retesting of the lower high resistance level. Even if there is a temporary price spike beyond this resistance, followed by a rejection, the bearish forecast would still hold. However, certain factors could negate this bearish view, such as consistent support from the bull market band, a weekly close above the $28,000 lower high resistance, and surpassing the $31,000 annual highs.

Regarding other technical indicators, Rekt Capital emphasizes Bitcoin’s recent surge to the 200-week moving average (MA), which currently acts as resistance. This 200-week MA coincides with the lower high resistance, marking a critical point for Bitcoin’s impending price direction. Despite a generally bullish outlook on Bitcoin, Rekt Capital warns about the $28,000 lower high resistance on the weekly chart.

On the daily chart, Bitcoin is hovering just above the 38.2% Fibonacci retracement level. To prevent a fall below the established trend line, Bitcoin must remain above $27,372.

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