2020 Gold Fractal Could Leave BTC Exposed To $27K Drop

A 2020 gold fractal could leave Bitcoin exposed to another correction to the $27K price level, as the price correction from the ATH seemed similar to the one of gold’s but let’s first see more in our latest bitcoin news.

The precious metal rallied to a new all-time high of $2,075 and this move upwards prompted traders to secure profits so the XAU/USD exchange rate started correcting lower in the sessions. The pair formed a new support area between $1847 and $1863 which broke back in November and fell as low as $1,764. The executive director of Green Bridge Investing Marc Principato outlined gold’s growing influence on the Bitcoin market and also said that BTC formed a consolidation descending channel pattern once it formed the record high which led Principato to envision a price point of $27,500. He added:

 “If 27.5K is compromised, for our strategy, that will signal a broader consolidation is likely in play. If you want to get a better idea of what this scenario may look like, look at XAUUSD from August to December. This is NOT a prediction; it is a potential scenario to prepare for if Bitcoin chooses to go this route.”

Bitcoin seems to be copying the gold market’s move from last year since a 2020 gold fractal shows some more insight that BTC could revisit $27K. The cryptocurrency tests the $30,774 levels for a potential breakdown to the nearest possible support target which could be $27,000 or $23,500. Principato added:

 “The 27.5K to 32K area so far has proven to be supportive. There is a failed low formation in play on the daily time frame while at the same time a new sell signal is about to confirm. As long as 27.5 continues to hold, probability favors an eventual bullish break out in the short term. This can take place over the next week or two.”

The analogy seemed reminiscent of the gold’s rebound once it hit the $1764 price point back in November. The precious metal moved back and then reclaimed $1863 area as support and went on to hit new highs of $1959 but it is now consolidating inside the same range. BTC draws plenty of comparisons from gold and many analysts including the ones at JPMorgan believe that the cryptocurrency will be able to steal a chunk of gold’s market in the future.