Bitcoin has already taken a hit, dropping over 22% since its peak in March. While it’s currently holding above $57,000, things could get worse if history repeats itself.
Bitcoin’s Love for Retesting Yearly Opens
According to Jacob Canfield, a trading expert, Bitcoin has a habit of revisiting its yearly opening price. This happens almost every year, with 2023 and 2024 being the exceptions so far.
Canfield points to several examples:
- In 2018, Bitcoin retested its yearly open just before the COVID-19 crash.
- The 2019 open was retested during the 2020 crash.
- The 2020 open was retested in the first three months of the year.
- The 2021 open was retested before a big rally to $69,000.
- The 2022 open was retested before Bitcoin dropped to $16,500.
Could We See Another Big Drop?
Canfield believes that Bitcoin could retest its 2024 opening price, which is around $38,000 to $42,000. This would mean another 33% drop for Bitcoin holders.
He also points to the 2023 opening price of $16,500 as a potential bottom, similar to what happened in 2019.
Key Indicators to Watch
Canfield highlights two key indicators that support his prediction:
- Fibonacci Retracement: The 0.618 Fibonacci retracement level aligns with the 2024 opening price, suggesting strong support in that range.
- Weekly 200 EMA/MA Ribbon: This indicator is also converging around the 2024 opening price, reinforcing its potential as a support zone.
The Bottom Line
While Canfield’s analysis paints a bearish picture, he emphasizes that Bitcoin’s market is cyclical and unpredictable. He believes that historical patterns offer valuable insights into potential future trends.
Ultimately, only time will tell if Bitcoin will retest its yearly opens and what the future holds for the cryptocurrency.
