Key facts:
On two previous occasions, BTC chained 5 weeks in a row of losses
The precedent of this situation is negative, with a long winter in the market.
The price of bitcoin (BTC) fell sharply this week, but the picture looks even bleaker if you look at the history of recent weeks. The cryptocurrency is repeating a negative behavior that has not been seen since 2014, when it was not on the radar of so many people in the world.
With the weekly close in the red of the previous week, it is already five consecutive weeks down for BTC. And this week it doesn’t look like the trend is going to reverse, with the more than 7% you have down at the time of writing this article.
This is the third time in history that BTC closed in the red five weeks in a row, according to the records of TradingView for the BTC/USD pair on Bitstamp. To locate the previous occasions, we have to go back to two periods of the year 2014: between March and April it had 5 weeks in the red, while it had a period of 6 weeks between August and September of that year.
With the behavior so far this week drawing to a close, it seems imminent that bitcoin chains six red weeks for the second time. So far, it has never been a negative seven weeks for the cryptocurrency.
For weeks now, the market sentiment has been in a situation of “extreme fear”, as we reported in CriptoNoticias in mid-April and it currently remains according to data from alternative.me. And this new pattern that bitcoin is showing does not seem to improve the public’s perception.
What happened in 2014 after these red weeks for bitcoin?
Although previous behavior does not determine that it should be repeated later, what happened with BTC in 2014 is not very encouraging about the future of the cryptocurrency in the short term.
When bitcoin fell for five weeks in a row, then came a slight recovery followed by another drop. During that second moment, it was when the 6 weeks in a row of losses were chained which are so far the worst streak in its history.
And those weeks were followed by a long winter for the price of BTC. It took him until 2016 to recover the ground lost after those two losing streaks. At that moment, BTC came from setting a maximum above 1,000 dollars. And that number did not return until the end of 2016.
Coincidentally, the losing streak occurred near the middle of the halving period (at the time it was the second cycle of BTC issuance during which miner rewards are reduced). This time the moment is very similar. This week has just marked the halfway mark of a new halving period. Will winter history repeat itself before a new bullish cycle for the cryptocurrency?
Well, to answer this concern, it will be necessary to take into account that the current Bitcoin market is very different from that of then, with much more money invested, large companies involved and the cryptocurrency even being adopted as legal tender in two countries to date. . In addition, the accumulation of BTC by more and more people only grows. These signs, all bullish, make it less likely that history will repeat itself, although it cannot be ruled out.