Bitcoin is trading around its former all-time high, and while a new record has been set, the crypto market has yet to see the fireworks they once expected here.
Instead, a pseudonymous technical analyst says that what the market should anticipate rather than an instant moonshot is “consolidation,” consisting of shakeouts, drifts, and traps of all kinds before the next leg up finally arrives.
Analyst Explains What To Expect For Bitcoin Price Action Below ATH
Momentum is back in the crypto market, driven by a new world and new Bitcoin stories that capture first the curiosity and then the capital of investors of all degrees of wealth.
Belief in the cryptocurrency has grown and a new wave of interest has driven prices. Few would have guessed that just nine months after Black Thursday and a retest of $ 4,000 that Bitcoin would have already established a new record ever.
Related reading | Five technical reasons why the Bitcoin Bull trend is taking a breather
The 2020 rally left both bulls and bears in disbelief although anyone who understands the potential of the cryptocurrency should know what it is capable of.
The market had expected Bitcoin to break its old record once it got here and never stop, but instead, there are now a few weeks of consolidation under resistance. And while that’s often a bullish sign that continuation will eventually follow, there’s only going to be a breakout after a number of shakeouts, falls in both directions, and extreme deviations – according to an analyst.
Although Bitcoin should "consolidate" below ATH, price action will get extremely volatile | Source: BTCUSD on TradingView.com
Hold On For Dear Life: Bull Traps, Shakeouts and Bear Fall – Oh My!
As mentioned, anyone who knows a thing or two about Bitcoin is probably aware of a few other key factors as well. For example, crypto investors know that post-halving, demand is starting to outweigh the scarce supply of BTC.
They also know that when $ 20,000 is breached with enough force, the parabolic phase where all the money will be made must begin. Finally they know the incredible valuations that the crypto asset is expected to reach from here.
Related reading | Max Pain: Why Bitcoin Can Trade Sideways Until April 2021
Given all the potential, value and profit to be made, it is not naive to assume that there aren’t many violent fixes, fleeting shakeouts, bull traps and bear fall for that tightly held BTC around every turn to change hands?
The phrase ‘wait for your sweet life’ or ‘HODLWas conceived as a way to help investors cope with the wild volatility of the asset and not risk being shaken apart while losing their precious BTC along the way.
Shakeouts are coming no matter how bullish Bitcoin is, it’s up to you whether you let yourself shake yourself enough to sell.
Featured image from Deposit Photos, Charts from TradingView.com