Undeniably both fractals look similar. The November - December 2018 sequence with the November - December 2019 sequence. The first provided the bottom of the latest Bear Cycle. Can the current one provide the bottom of the June correction? This is what I will address on this study.
Let's start off with the similarities of the two sequences:
*It all starts with a wick* Both sequences started with a wick. In 2018 it was the Fall of Tether. The first 'stable coin' (USDT) which supposedly pegged 1:1 to the U.S. dollar fell up to 15% at the same time as the price of Bitcoin fluctuated wildly. A massive selloff for tether against BTC was seen, resulting in a price rise in Bitcoin. In 2019 it was the bullish talk of China's President Xi that gave a massive pump to Bitcoin, after he gave a speech embracing blockchain technology and calling on his country to advance development in the field. Both bullish moves were later cooled off and after days of consolidation BTC started to drop rapidly.
*The 0.618 Fibonacci as a Resistance* In both cases the 0.618 Fibonacci retracement level contained any upside attempts (at least so far for the 2019 one), effectively acting as a Resistance. In 2018 the High after the 3,200 bottom formed a Resistance level that was tested 3 times before it broke upwards on April 2nd, starting a 3 month parabolic rise. That remains to be seen for 2019.
*Candle action* Both sequence undeniably form similar candle patterns, especially after their bottoms. We can also argue that the bottoming process can be seen as an Inverse Head and Shoulders.
Now let's take a look at the differences:
Those are not that many actually and I will focus on the duration. The 2019 sequence is shorter but we can argue it is natural as the 2018 Bear Cycle has been twice as long as the June 2019 correction. It makes sense to assume that their Bottoming Process will share this analogy. This is something I first looked into on the following study, calling a December low:
Another difference is that the 2018 sequence was much more aggressive with the 3200 bottom being way lower than previous one (around 5700 in June 2018), while the current one has been more structured as it naturally trades within a Channel Down, with the previous low being around 7200.
Which batch do you think weigh more, the similarities or the differences? Is the 2019 a legit bottoming sequence? Let me know in the comments section!
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I think that people are doing statistical arbitrage on Bitcoin and Ethereum, believing that the two are coupled and deserve to trend together. However, I firmly believe Ethereum is the better technology. If the high frequency trading / arbitrage bots are turned off, we will see a massive drop in Bitcoin price. Otherwise, there may be a bull-run.
TradingShot
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@dysonring2050, Thanks for sharing your opinion on the BTC ETH subject with us. You may find this idea useful:
CryptoBullet
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Is 6k actually a major support? You can read my idea and figure this out!