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Leading traders say Bitcoin’s logarithmic chart suggests an upward trend similar to what it saw in late 2017

October 23, 2020

Peter Brandt, a highly respected veteran dealer, He recently stressed that high institutional demand is a major catalyst for Bitcoin’s strong performance.

1-month chart of the BTC / USD pair. Source: TradingView

BTC’s strong technical structure over longer periods of time, especially on the weekly chart, and the strengthening of fundamentals are driving current market sentiment. Brandt posted the above graphic in a tweet He said::

“If current earnings continue through October, Bitcoin will be set for the second highest month-end closing in its history. $ BTC institutes are increasingly involved in Bitcoin’s involvement. The institutes register the value of their assets on a monthly basis. “

In addition to the increase in trading volume and the growing institutional appetite Investors refer to the logarithmic chart to predict a broader rally.

Raoul Pal focuses on the logarithmic graph of Bitcoin

Leading traders say Bitcoin’s logarithmic chart suggests an upward trend similar to what it saw in late 2017
Leading traders say Bitcoin’s logarithmic chart suggests an upward trend similar to what it saw in late 2017

The logarithmic price chart is the scale most used by most technical analysts. A logarithmic chart simply means a chart that shows frequent percentage changes with the same distance on a scale.

Raoul Pal, Founder and CEO of the Real Vision Group says that Bitcoin’s monthly logarithmic chart is very optimistic. Wrote::

“It’s a bitcoin-like day. The monthly logarithmic graph with regression lines is really something to see. One of the prettiest and most powerful chart patterns I’ve ever seen. “

The technical reason for the monthly log chart optimism is mainly its clean breakout. For the past four years, the $ 13,000 has acted as a strong resistance level.

The historical logarithmic chart of Bitcoin. Source: Raoul Pal

In longer time frame charts such as the weekly and monthly charts Bitcoin always closed below $ 11,000, except in 2020.

Bitcoin’s clean technical breakout on the monthly timeframe leads leading traders and investors like Brandt and Pal, to make big bullish predictions about Bitcoin price developments. As Pal said “If history rhymes, 2021 will be a great year.”

1-month chart of the BTC / USD pair. Source: TradingView.com

The fourth quarter can close well

Apart from numerous bullish fundamentals and technical catalysts The timing of the current move also suggests a big Bitcoin bull cycle.

Quarterly Bitcoin return in percent. Source: Skew

According to Distort dataBitcoin has not had three positive quarters in a row since 2017. That year, Bitcoin hit its all-time high of USD 20,000 After the 2016 block mine reward was halved for the second time.

Bitcoin could be on track to see a big rally in the fourth quarter if it holds above $ 12,000. If so, this could lead to the same bull cycle pattern observed in 2017. The same cycle after the halving that Bitcoin experienced in 2017 would also occur next year. which further reinforces the theory of a new bull cycle.