Bitcoin price has been trapped in a tightening trading range and has barely moved in weeks. The top cryptocurrency by market cap has been boring compared to its characteristically volatile self.
Looking back at the asset’s historic volatility, a fractal pattern could be forming that suggests the price per BTC is about to blast off to unprecedented heights.
Fractals And How History Doesn’t Rhyme But It Often Repeats
Mark Twain said that “history doesn’t repeat, but if often rhymes.” The statement best explains the theory behind repeating price patterns called fractals.
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These fractals appear similar to another point in historic price action, and help analysts to predict and anticipate future market behavior. The results can be mixed, as rarely do things play out exactly the same. This fact has earned fractals a negative reputation, however, even in Bitcoin there is some specific behavior that can be expected.
Every cycle looks similar by comparison when zooming out | Source: BLX on TradingView.com
For example, each major breakout past all-time high resulted in a parabolic uptrend and the visual comparisons are undeniable. The most recent uptrend of which has come to a screeching halt, turning a stumble into a full-on 50% or more collapse.
While the market ponders if the bull trend is kaput, even technicals have become mixed. There is a handful of doji candles on the weekly, a tight trading range, and volatility has dropped to an important level. All of these signs point to a potential reaction, and if “history” has anything to do with it, the volatility should be released to the upside.