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In a bull market, it’s very healthy for prices to digest sideways before each leg higher. This shakes out the chasers/weak hands and builds energy for the next move. Stocks have been doing just that for the past 12 years:
Bitcoin is no exception to this dynamic. It’s gone up 4x in less than 3 months. If that slope were to continue without any rest for the next 12 months, we’re talking another 250x move taking BTC to a whopping $180T market cap! Even the biggest Bitcoin bull would admit this would be crazy. Thus, a consolidation is definitely needed.
Crypto is at some major resistance here, but there’s also some major support not too far below. This gives us a defined range for a potential consolidation.
First, let’s look at 3 charts showing the big resistance level we’re facing.
ETH is retesting those early 2018 highs.
BTC:QQQ Ratio is also retesting the former late-2017 highs
BTC:ARKW is at resistance as well
Now let’s look at 2 charts charts showing where strong support lies.
BTC:SPX Ratio broke out from the 2017 highs. That level is now support
BTC:GOLD Ratio. Ditto.
Such a consolidation can take weeks and even months. Sit tight and let things play out.