The crypto markets, like the traditional finance world, are due to the behavior of thousands, if not millions, of investors making individual decisions. These seemingly unrelated and unconnected decisions, when looked at from a bigger-picture perspective, start to form a pattern. This is the reason why fractals occur in nature, this is the reason why history rhymes and sometimes repeats itself.
Hence, paying close attention to social cues could be a powerful tool in the hands of the right investor. As the second quarter of 2023 kickstarts, certain repetitive behaviors are beginning to resurface that could indicate that a local top for the 2023 bull rally might be around the corner.
While the crypto market and stock market happen to be starkly different from each other, in some ways, they share a lot of similarities. The changes in prices due to market events are both cyclical in nature, i.e., they follow a pattern of highs and lows and form tops and bottoms over time.
In the case of the crypto market, year to date, digital assets have noted significant increases. Bitcoin price since the beginning of 2023 has risen by over 70%, and Ethereum price similarly over the last three months has increased by 58%. Other altcoins have also noted massive gains, which indicate an active bullish narrative.
However, certain recent events suggest that a top could be forming.
Over the last few months, the crypto market has noted instances suggesting a local top, such as:-
But this is not the first time this has been observed, as in the past, similar events have occurred that led to the formation of a local top.
IMX social sentiment
Although it is premature to predict a local top, investors need to be cautious regardless, as the aforementioned signs are usually signals of a top and can trigger a drop in price at any time.
As for now, Bitcoin investors need to watch out for a rise to $35,000 and $38,500, as these would mark key levels for taking a profit. At the same time, should corrections arrive and Bitcoin price fall below the key support level of $24,736 to $17,600, selling pressure could rise.
For more information on potential corrections or retracements in the future where investors can accumulate, refer to the article attached below.
Bitcoin Weekly Forecast: Breaking down key BTC levels to accumulate for Q2, 2023
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