Bitcoin Shows Parallels With The 2017 Cycle, Here’s What May Happen Next

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A quant pointed to parallels between the current Bitcoin cycles and 2017, something that may hold clues to where the asset is headed.

Bitcoin’s current cycle showed interesting parallels with the 2017 cycle

As one analyst explained in an article on CryptoQuant, there have been five interesting recent events in the current cycle that are similar to what was seen in the 2017 cycle.

The 2017 cycle peaked in December of that year, while the current cycle peaked in November 2021. The entirety of these cycles are irrelevant in the context of the current discussion; only downtrends that followed after their respective highs were reached.

Related Reading: Bitcoin Circulation Rate Remains Weak, Why It Could Be Bad For The Rally

The chart below shows the trend of percentage pullbacks seen after the 2017 and 2021 Bitcoin cycle highs:

The bear markets of the 2017 and 2021 cycles compared | Source: CryptoQuant

As you can see from the graph, the quant marked some of the relevant parts of the cycles that were similar to each other. In both of these cycles, the price first observed a bear market phase where the asset consolidated endlessly. In the case of the 2017 cycle, the sideways movement was around the $6,000 level, while for 2021 it was around the $20,000 level.

Both periods of consolidation ended with a sharp drop in price. Assuming that the lows after the November 2022 FTX crash were the worst this bear market had, then similar sharp drops in those cycles lead to bearish lows for both as well.

After these lows, the price resumed a sideways movement again in the 2017 and 2021 cycles. In the 2017 cycle, the price followed this period with strong upward momentum in the form of the April 2019 rally. The current cycle seems also show something similar in the form of the rally that started earlier this year.

Bitcoin hit a roadblock midway through the April 2019 rally and fell back into a sideways consolidation phase. The quant thinks this is the phase the current cycle is in right now, as BTC’s price action has been pretty stale recently.

The X axis of the chart shows the number of days from the peak that these events have taken place in these cycles. It is interesting how close the cycles have apparently been to not only the structure, but also the timing of events.

If the parallels between these two Bitcoin cycles hold going forward, the current sideways trend could be followed by a sharp rise in price, as the April 2019 rally also continued its sideways phase with a strong uptrend. .

BTC price

As of this writing, Bitcoin is trading around $28,300, up 1% in the past week.

BTC has continued to move sideways in recent days | Source: BTCUSD on TradingView

Featured image by Andr François McKenzie on Unsplash.com, charts by TradingView.com, CryptoQuant.com

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