Bitcoin has fallen below $ 35,000, and while the asset’s recent highs sound like a sizable correction, the price per BTC is still nearly 1000% higher than it was less than a year ago. After such extreme upward movements, crashes often occur, which destroy a large part of the progress made until the parabola starts all over again.
Career trader Peter Brandt shared a chart that subtly suggests that the recent Bitcoin price parabola could collapse. The last time he did this, he named exactly an 80% price drop. Here’s a look at what might be next if it does.
Paying attention to Peter Brandt does not cost anything, it pays off in profits
Peter Brandt is a living legend who has spent an entire career trading goods, stocks and, more recently, cryptocurrency professionally. Brandt has long been interested in Bitcoin, shared his comment on the market and the associated price movements on Twitter, and contributed to the Bitcoin.Live platform.
Because of Brandt’s reputation and experience, it is worth paying attention to when speaking. In fact, those who wisely took profits during the last major Bitcoin rally after the trader claimed the parabola had been violated were given almost the exact same target that the cryptocurrency fell to almost a year later.
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The trader is known to request a backtrack of 80% or more after hitting $ 20,000 in 2017. In 2018, Bitcoin was trading at $ 3,200. Brandt did it and now he’s back.
Peter Brandt draws attention to the current rally, which is similar to this earlier parabola breakdown Source: BTCUSD on TradingView.com
Brandt brings back painful memories of past Bitcoin parables
Brandt points out that the last time he shared a price chart with a Bitcoin parabolic curve was just before the bear market hit.
In the image originally shared on Jan. 8, 2018, a repeating “bump, hump, lump, and dump” pattern shows each parabolic base nearing collapse and the resulting downtrend. The graphic above compares the rally Brandt references with the current parabolic rally.
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Price patterns and even ranges seem incredibly accurate, with the main discrepancy being the pandemic-induced panic sell-out on Black Thursday. Apart from that, the similarities are striking.
Repeating price patterns like these are called fractals. If what follows this nearly flawless fractal is also similar, the table below would show what comes next.
Here's what happened after the parabola breakdown | Source: BTCUSD on TradingView.com
Remember, Brandt requested 80% parabolic motion correction and was correct. And while he hasn’t addressed this dangerous data point since then, even the short-lived parabolic phase ultimately corrected over 70% in 2019.
Each disadvantage, however, depends on the current parabola collapsing and the new “hump, dip, pump and dump” pattern not being repeated.
Featured image from Deposit Photos, Charts from TradingView.com