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Bitcoin Has Reached The 0.5 Fib Resistance
It’s phenomenal to see Bitcoin repeating the 2013 Mid-Cycle recovery so closely.
History is truly repeating itself.
And also - history is in the making, as Bitcoin is gearing itself up to take off into the second part of the market cycle.
Right now, Bitcoin has reached the black 0.5 Fib Curve resistance:
The Fib Curve represents a price point of ~$54000.
And this is the level Bitcoin needs to break convincingly beyond this October to confirm the second part of the cycle.
But why is this 0.5 Fib Curve so important?
Because it represents the mid-point of this overall Bitcoin log Growth Curve Channel.
Essentially, it is the point that highlights a middle point of the cycle for BTC (i.e. mid-cycle).
And for Bitcoin to progress beyond the mid-cycle, it needs to break this 0.5 Fib Curve resistance.
So let’s talk about what needs to be done going forward.
But first, let’s look at previous cycles to set the stage to understand some of the recurring technical events that need to be replicated over the coming weeks and months.
Bitcoin & The 0.5 Fibonacci Curve - 2013
In 2013, Bitcoin consistently held the yellow 0.382 Fib Curve support on the Monthly timeframe, continuously Monthly Candle Closing above this support.
This holding of support enabled BTC to finally challenge the black 0.5 Fibonacci Curve in October and break beyond it, with a Monthly Close above this black 0.5 Fib Curve.
The following month in November, Bitcoin dipped to turn the 0.5 black Fib Curve into support:
As is the case with breakouts, they start with candle closes above the key resistance and then price dips to flip that very same level into a new support.
In 2013, the black 0.5 Fib October resistance was flipped to new support in November.
And in November, upon successful retest of the 0.5 Fib - price exploded towards the top of the Bitcoin log Growth Curve Channel to peak in its Bull Cycle.
Key takeaways:
- When Bitcoin breaks beyond the black 0.5 Fib Curve resistance, BTC needs to retest it as support in the following month(s) to confirm a breakout to new All Time Highs
- Once the breakout is confirmed, Bitcoin continues its second part of the cycle towards the very top of the log Growth Curve Channel where BTC finally peaks in its Bull Market.
Bitcoin & The 0.5 Fibonacci Curve - 2017
Just like in 2013, Bitcoin broke beyond the 0.5 black Fib Curve resistance.
However, it did this in August, whereas in 2013 BTC broke out beyond it in October.
However, in 2017 BTC retested the black 0.5 Fib Curve as support in the following month of September and also in October as well.
In essence, Bitcoin was retesting the black 0.5 Fib Curve as support for two months.
In 2013, Bitcoin only needed one month to retest it.
Moreover, in 2017 when Bitcoin finally retested the black 0.5 Fib Curve as support, it confirmed the breakout and enjoyed trend continuation.
But what’s important to mention here is that it took Bitcoin three months in 2017 to reach the very top of the log Growth Curve channel to peak in the Bull Market after having successfully retested that all-important black 0.5 Fib Curve as support.
In 2013, it took Bitcoin only one month to reach the very top of the channel following the successful retest of the black 0.5 Fib Curve.
Why is this important?
Because we know that:
- The black 0.5 Fib Curve resistance needs to be breached to set up the second part of the cycle
- The black 0.5 Fib Curve needs to flip into support to enable trend continuation
- After the retest, BTC ascends to the top of the Growth Curve channel and peaks.
These are the essential technical steps that need to occur for Bitcoin to a) enjoy the second part of the cycle before finally b) peaking in the cycle.
The black 0.5 Fib Curve is the metronome for transitioning Bitcoin away from the mid-cycle period into the second half of the cycle.
And the point of this analysis is to emphasise that a) the time it takes to retest of the black 0.5 Fib Curve may be lengthening and b) the time it takes to reach the top of the log channel may be lengthening also.
Bitcoin & The 0.5 Fibonacci Curve - 2021
How can these historical insights across Bitcoin cycles help us going forward?
Step 1 - Bitcoin needs to Monthly Candle Close above the black 0.5 Fib Curve resistance in October.
This black 0.5 Fib Curve level represents the price point of ~$54500.
But before we move onto Step 2, here’s a very curious insight about how much Bitcoin tends to overextend beyond the black 0.5 Fib Curve in an effort to perform this all-important Monthly Close:
How much did Bitcoin overextend beyond the black 0.5 Fib Curve in 2013?
Around +17%.
How much did Bitcoin overextend beyond the black 0.5 Fib Curve in 2017?
Around +16%
How much could Bitcoin overextend beyond the black 0.5 Fib Curve in 2021?
Around 16 to 17%, by standards of history.
Which would mean Bitcoin could rally as high as ~$63,000-$64,000 in October all in an effort to position itself well for a Monthly Close above the black Fib Curve level of ~$54500.
And once that Monthly Close above ~$54500 occurs…
Step 2 - Bitcoin needs to dip into the black 0.5 Fib Curve to flip it into a new support.
And if in 2013 it took Bitcoin less than a month to do this before ascending to the top of the log channel, and in 2017 it took three months to retest it before ascending to the top of the log channel…
Is it possible that this retest of the black 0.5 Fib Curve takes place over the coming months?
And if that retest takes a few months, then does that mean that Bitcoin’s actual ascent towards the top of the log Growth Curve channel following a successful retest attempt of the black 0.5 Fib Curve level also takes a few months?
Because if in 2013 the retest took less than one month before Bitcoin rallied inside that same month to the top of the channel…
And in 2017 the retest took two months before Bitcoin rallied to the top of the channel in three months…
Then in 2021 could it be that Bitcoin takes a) three months to retest the black 0.5 Fib Curve as support before b) taking another three months to ascend to the top of the log Growth Curve channel?
That would mean that the second part of Bitcoin’s cycle could last another 6 months.
All in all, it’s difficult to define how much time these two technical events will last in terms of time.
But at least we now know to pay attention to them.
Thank you for reading.