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▲ Bitcoin (BTC)/AI generated image
An analysis has emerged suggesting that Bitcoin (BTC) is once again creating a similar trend to the long-term chart structure that appeared just before a 400% rally in the past. In the previous cycle, Bitcoin broke through its existing all-time high, then retested that level, and subsequently rose from around $17,000 to $69,000.
NewsBTC reported on May 11 (local time), citing a chart shared by cryptocurrency analyst CryptoTice on May 7, that Bitcoin is forming a technical structure similar to that before its previous major rally. According to the analysis, structural signals that appeared before Bitcoin entered a strong expansion phase in the past have re-emerged in the current long-term chart.
In the 2020 market cycle, Bitcoin broke through its previous all-time high after a long period of sideways movement and accumulation. However, the breakthrough did not immediately lead to a sustained rally. Bitcoin formed a horizontal trading range near the breakout level, and significant trading activity occurred in this area.
According to the chart presented by CryptoTice, Bitcoin is currently showing a similar structure. Bitcoin has already surpassed its previous all-time high and is now staying in a similar horizontal range again. It is explained that, similar to the previous cycle, after price increases slowed down, it entered a phase of trading near the past resistance level to confirm support.
The key is whether the previous resistance level turns into a support level. In past cycles, Bitcoin confirmed support near its existing all-time high after the breakout without collapsing. This process was interpreted as a retest of the previous high, and the market subsequently regained upward momentum, entering a full-fledged expansion phase.
The current chart is also approaching the same retest phase, according to the analysis. Bitcoin has recorded a new high and is now descending back to the breakout level, which CryptoTice sees as the retest phase of the current cycle. If this level is maintained, it could be a similar starting point to the one just before the past 400% rally.
NewsBTC reported that Bitcoin is currently trading at approximately $80,667, with a market capitalization of about $1.61 trillion and a circulating supply close to 20 million BTC. Although the market size has grown much larger than in the previous cycle, the long-term price structure is still said to resemble past formations.
CryptoTice's chart applied the sequence of previous high breakout, retest of the breakout level, and subsequent sustained rally to the current market. The analyst presented the maintenance of the key support level indicated on the chart as the criterion for judging the validity of the pattern. The analysis suggests that if Bitcoin defends this support, it could be the starting point for the next major upward phase.
However, this analysis is a technical interpretation focused on the similarity between past patterns and the current structure. Whether Bitcoin will actually repeat a 400% rally like in the past depends on the maintenance of the retest level and the subsequent recovery of buying momentum. The key in the current market is whether the support level formed after breaking the previous all-time high can once again become a stepping stone for an expansion rally, as it did in the past.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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