- Bitcoin now trades at $11,250 after peaking at $11,600 earlier today.
- The cryptocurrency has seen this volatility due to the reaction in the values of gold and the U.S. dollar to Jerome Powell’s speech.
- In the speech, the Federal Reserve chairman said that inflation could be over 2%.
- Bitcoin remains in no man’s land in terms of technical analysis.
- A fractal identified by two analysts suggests that BTC will consolidate in this no man’s land in the weeks ahead.
- The consolidation will likely mean Bitcoin trades between $10,800-11,400 for a maximum of three weeks.
BITCOIN COULD FLATLINE FOR THE NEXT FEW WEEKS: HERE’S WHY
Bitcoin is likely to flatline in the low-$11,000s in the coming two to three weeks according to a recent fractal analysis.
A fractal, in technical analysis terms, is when an asset’s price action is repeated again on a different time frame or with a different market. Fractals are used to predict in which direction an asset will head after a historical pattern is seen.
Two individuals think Bitcoin is currently trading in a fractal of the May to July consolidation. During that consolidation, BTC spiked prior to flatlining for a number of weeks in a tight range.
Bitcoin undergoing the same pattern now, according to the analyses, will mean it flatlines for the coming two to three weeks between $10,800 and $11,400.
Chart of BTC's price action over the past few months with a fractal analysis by crypto trader/chartist "Nunya Bizniz" Chart from TradingView.com
UPSIDE IS LIKELY AFTER CONSOLIDATION
The fractal suggests that Bitcoin will move higher after the ongoing consolidation period. Fundamentals and other technical analyses corroborate this expectation.
Dan Tapiero, co-founder of Gold Bullion Int. and other firms, commented that the asset is breaking out of a macro consolidation pattern:
“Tremendous long term Log Chart of #Bitcoin projects up 5-10x on this run. Just breaking up NOW. Should last a few years as 2.5yr consolidation is fantastic base for catapult up. Break of old highs will have explosive follow through. Time to sit and be patient.”
Arthur Hayes, CEO of BitMEX, is also optimistic about what’s to come for Bitcoin.
Hayes thinks that the monetary and political uncertainty will drive value to BTC:
“The financial markets are going to whipsaw as politicians contort themselves to continue feeding at the trough. This unfortunately will have lasting effects on everyone’s lives across the globe. Out of the chaos, more people will mistrust centralised authority and look for ways to protect their physical persons and capital from the wanton destruction waged upon them by their rulers.”
He previously stated that Bitcoin would trade at $20,000 in 2020.