Bitcoin price has now had one of its largest pullbacks dollar for dollar in history, putting the entire parabolic uptrend in jeopardy, according to one crypto analyst who has warned the top could be near.
The analyst, who has been accurate in the past, claims that it is now “crunch time” for the parabola to prove its strength, or risk the start of a violent breakdown.
“Crunch Time” For Bitcoin Parabola, As Uptrend Support Line Is Tested
An asset that “goes parabolic” is a rare event, occurring when price action continues to rise at an accelerating speed and steepening angle. When the momentum finally runs out, the correction is especially violent.
Because of this, when the trend is close to its peak, things become dangerous for late to the game investors or those who have yet to take profit. For example, each time Bitcoin has broken down from its parabolic advance, it has resulted in an 80% or more correction, wiping out a substantial portion of portfolio ROI.
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The leading cryptocurrency by market cap is now on its third parabolic uptrend, but predicting the top isn’t so simple. According to crypto analyst Dave the Wave, however, the peak based on the long-term chartist’s interpretation of a logarithmic growth channel could be near.
Due to the close proximity to the upper threshold to the logarithmic channel the analyst has drawn coinciding with the pullback landing on an important trendline, the analyst says it is now “crunch time” for the parabola.
It is “crunch time” for Bitcoin’s ongoing “parabola” according to this chart | Source: BTCUSD on TradingView.com
Charting The Peak Of The Current Cryptocurrency Bull Market Cycle
A breakdown from current prices would mean the parabolic advance could be complete, and another bear phase could follow. The last bear market took Bitcoin from $20,000 to $3,200 at the low, or an 84% decline.
An 84% decline from the high of $58,000 would take Bitcoin back below five digits and to the mid-$9,000 range. Mathematically, statistics show it is possible, but only if the parabola is indeed complete.
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The scenario is also just one prediction based on one highly accurate analyst, and others see a very different story unfolding. According to Dave the Wave’s chart above – an analyst who accurately predicted both the bottom in 2018 and peak in 2019 – the peak of the current cycle is near, while others see a trajectory to $325,000 per coin or more.
Not only is it crunch time for Bitcoin’s parabola, but it could be crunch time for the top of the logarithmic growth channel and its ability to hold back a powerfully trending cryptocurrency.
Featured image from Deposit Photos, Charts from TradingView.com