- There are several indicators that Bitcoin may be headed for another bull run.
- The similarities between the 2018 bear market recovery and bitcoin in 2023 are so uncanny, that K33 even stated that the resemblance is “staggering.”
- The peak-to-trough drop in 2018 was more severe (84% vs. 78%), but other than that, the similarities are still startling.
- The moving averages on the weekly chart show something very interesting
As the first and biggest cryptocurrency, Bitcoin (BTC-USD), emerged in 2022, one of the worst years in its 14-year history, it may be worthwhile to look back and examine some of the obstacles it overcame.
Bitcoin has survived multiple iterations of different regulations, including a few outright bans by different countries. Yet, in 2023, the price has risen 70% year to date and 81% from the low in November.
The failures of Terra, Celsius, and FTX have raised concerns in light of the events of 2022, but Bitcoin has persevered and continues to hold the top spot among digital currencies. Although some of the hazards associated with the broader crypto ecosystem have been highlighted by these failures, Bitcoin’s resilience and stability in the face of difficulty are also obvious.
However, there are several indicators suggesting that Bitcoin may be heading for another bull run. One of these is how its current price action may be mirroring that of the 2018 bear market recovery.
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Bitcoin May Have Bottomed Out In 2022
The bitcoin rise this year is eerily similar to the bear market recovery of 2018.
January 2018 marked the beginning of the 2018 Bitcoin meltdown. After experiencing an unprecedented rise in 2017, the price of Bitcoin crumbled by nearly 65% between January 6 and February 6, 2018, taking most of the other cryptocurrencies down with it.
After losing about a third of its value the previous week, Bitcoin plunged by 80% by November 26.
In 2022, however, the cryptocurrency had a 78% drop in value from over $69,000 to below $16,000 by December 2022.
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These cycles, according to the research unit K33, lasted approximately 370 days, and the recovery patterns were similar in both cases, with a 60% return in 510 days
The similarities between both events are so surprising, in fact, that K33 stated that the resemblance is “staggering.”
In light of this, K33 says that no one should anticipate a 1:1 matching of the present decline to earlier drawdowns.
However, they also think Bitcoin might rise to $45,000 by May 20 – a 50% increase from today — assuming the 2018 bear market ended after 556 days and a 34% loss from the 2017 peak if history chooses to repeat itself.
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K33 notes that the peak-to-trough drop was more severe in 2018 (84% compared to 78%), but apart from that, the similarities are still striking.
It is challenging to offer a convincing explanation for the striking similarities. However, knowing the average BTC holder, many would be reluctant to sell at a 60% decline from the last high and use these times as times for accumulation.
Bitcoin Price Analysis – How Close Is A Rally?
Although no one can forecast the exact price of Bitcoin in the future, analysts think $50,000 is a reasonable goal for the cryptocurrency in 2023.
Experts including Vetle Lunde, a senior analyst at K33 Research, believe that there is a good chance that Bitcoin will hit $45,000 – $50,000 this year.
They anticipate that at some point in the middle of the year, specifically towards the end of the second quarter or the beginning of the third quarter of 2023, Bitcoin reaching $45,000 will become a reality
Even in the event of another market meltdown, a surge to that level during the summer may still occur.
This forecast is based on a variety of variables, including the growing public acceptance of cryptocurrencies, the rise in institutional investors, and the finite amount of Bitcoin available.
In the charts, Bitcoin has already risen by more than 70% over the first three months of the year.
The cryptocurrency is currently facing resistance around $30,000 and has entered a rejection phase to $29,000.
However, the performance of the Bitcoin bulls around the $30,000 zone will have a significant impact on how high the cryptocurrency can rise, and whether levels above $40,000 are achievable.
Is +$40,000 On BTC Possible Soon?
Switching to the weekly chart, we can see a few things.
The first is that Bitcoin is approaching overbought conditions, and the bulls should be concerned.
However, there are several other bullish indicators involving its moving averages. The first is the glaring golden cross between its 20 and 50-day moving average, indicating strength on the part of the bulls.
The second takes more of a closer look.
Since November 2021 (when the bear market started), bitcoin has been under these two moving averages, trading lower and tumbling down from $69,000 to as low as $15,500.
This time, however, for the first time in literal years, Bitcoin is back above and is doing comfortably well, far above.
This is a big win for cryptocurrency because even in the event of a pullback, this might just be one of the major indicators that the 2021 bull market may finally be over.
Are these analysts right about Bitcoin being able to reach +$40,000 this year? Maybe. The only guaranteed verdict is that time will tell.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.