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Over the past few days, Bitcoin (BTC) has stalled, finding itself between a rock and a hard place. Many analysts are currently undecided where the cryptocurrency will go in the next few weeks, though one top trader recently noted that BTC’s price action at $9,200 could be a precursor to more downside.
How Bearish Is Bitcoin’s Rejection at $9,200?
In the wake of Bitcoin’s flash crash at $9,200 last week, Haejin noted that this represented a “mega rejection” on a daily basis. He specifically looked to the fact that BTC saw a bearish retest of the 200-day moving average, collapsed out of a multi-week rising wedge, and failed to surmount key macro resistance — three signs showing bears remain decisively in control.
https://t.co/JhMTlE2zA1: Partial Bitcoin Chart of the Mega Rejection!! pic.twitter.com/CMXsreWwA1
— Haejin (@Haejin_Crypto) January 24, 2020
So what does this “mega rejection” mean for Bitcoin per Haejin? Well, it fulfills a bearish fractal that the commentator laid out.
Per previous reports from NewsBTC, this Haejin last week pointed out that Bitcoin’s price action since the $14,000 top in June is eerily reminiscent of that seen in the 2018 bear market, with both cycles seeing a downward price channel, an upward wedge-formed false breakout (like the one we just saw), declining volume, and signs of capitulation.
Haejin then added that if BTC follows the exact path it did in 2018, the price will soon collapse back to the $6,000s, then Bitcoin will capitulate in March or April to fall as low as $3,300 by the time of the halving.
https://t.co/JhMTlE2zA1: Bitcoin Deja vu?
Here is a Members only chart: Note the Inverse H&S on both fractals.
Also the three wave ABC price constructs
The downward price channel
The upward wedge
Declining volumes
Potential Capitulation VolumeAll within 4 months? Hmmm. pic.twitter.com/hXNN53PI7B
— Haejin (@Haejin_Crypto) January 17, 2020
Can Bitcoin Bulls Step In?
Although this rising wedge breakdown is notably bearish, analysts haven’t given up hope that bulls will eventually step in, negating the aforementioned fractal analysis.
Just this week, analyst Filb Filb — who notably called Bitcoin’s flash pump to the $9,000s and crash to the $6,000s in late-2019 — wrote in a recent newsletter that he is bullish on BTC heading into the block reward reduction or “halving” slated to take place in May:
“Overall, Bitcoin is exactly where [I] anticipated; slowly grinding up towards previous resistance… I’m very much of the opinion that Bitcoin will reach to at least $12,500 level before the halving.”
As to why $12,500 makes sense, he noted that that is the “top target” for a bullish inverse head and shoulders chart that is forming on a medium-term basis for Bitcoin.
There’s also Financial Survivalism, a trader who in December called BTC’s move into the $8,000s and $9,000s we just saw, explained in an extensive TradingView post that he thinks that BTC is on track to hit $20,000 by July 1st.
Survivalism cited a flurry of strong technical factors and the impending halving.
Related Reading: Key Google Metric: Bitcoin May Explode Into $100,000 Parabolic Rally
Featured Image from Shutterstock
