The 2022 bear market was brutal as more than $2 trillion in value was wiped away from the cryptocurrency economy. In addition to missing benchmark values, the crypto winter has managed to break a number of popular Bitcoin price models such as the rainbow price chart and the popular Plan B stock flow model. Moreover, since May 11, 2022, it has also broken the well-known power law corridor model or logarithmic growth curves diagram, and drifted below the lower band for about 86 days.
Deviation from the norm: Bitcoin’s 2022 bear market breaks some of the most popular price patterns
For many years now, cryptocurrency traders have utilized tools, charts, and models to predict the future value of Bitcoin (BTC) and other popular digital assets. Bitcoin.com News has written about the Plan B stock-flow (S2F) price model on numerous occasions and in 2021 the S2F model was fairly accurate until the end of November.
In addition, many bitcoins rely on charts and other price models such as the golden ratio multiplier, Fibonacci sequence, rainbow pattern, and logarithmic growth curves. During the last quarter of 2021, bitcoin traders expected BTC to reach $100,000 per coin by the end of the year.
In September 2021, when BTC was swapping prices between $45K and $50K, Will Clemente, Lead Insights Analyst at Blockware Solutions, tweeted about a new price model he called the “Illiquid Supply Floor”. At the time, Clemente said that the model combined Glassnode’s illiquid supply data with S2F’s Plan B model and said that it created a ground price for Bitcoin based on the real-time scarcity of BTC.
The minimum value that Clemente predicted was $39,000, and over time, the analyst’s illiquid supply floor model broke. Even after the “worst-case scenario” forecast for Plan B veered at the end of November, the pseudonymous analyst said he was confident that the price of bitcoin was still “on its way toward $100,000.”
None of these bold predictions came to fruition, and in the midst of the start of the crypto bear market, these types of price patterns were publicly mocked them It was denounced by many people in the cryptocurrency community. The liquid supply floor wasn’t solid, S2F broke, and people laughed at the famous “rainbow” price index.
You have created a new and improved template for your rainbow chart pic.twitter.com/zgjbqQtOb1
– LevelsDennis.lens (levelsdennis) June 19, 2022
The People’s Power Law Corridor model recorded a break of 86 consecutive days from the norm
Moreover, one of the most popular bitcoin price models, known as the Energy Law Corridor Model, or logarithmic growth curves chart, has also been broken since May 11, 2022. The chart is preferred because the BTC price timeline can be seen from the logarithmic impression. In fact, the history price chart is one of the most popular price charts in the world of crypto and traditional financial technical analysis.
Charts of bitcoin’s logarithmic growth curves are hosted on crypto web portals such as lookintobitcoin.com and coinglass.com. The current anomaly is unusual as the price of BTC has only fallen below the lower band twice in history prior to 2022. The first deviation occurred quickly in October 2010, and the second most noticeable deviation occurred on March 11, 2020.
March 11, 2020, otherwise known as “Black Thursday,” was an interesting day for every asset on the planet as financial markets shuddered across the board. At the time, Bitcoin broke below the $4K range, and the move fell below the low development line on the logarithmic growth curves chart.
This specific event did not last long as global markets rebounded from the initial panic of Covid-19, and a bull market occurred almost immediately. Bitcoin price rose to the $64,000 region in April 2021, and above that range to $69,000 on November 10, 2021.
Nine months later, Bitcoin (BTC) is down 66% from its all-time high of $69K, breaking the popular and trusted logarithmic growth curve pattern for 86 consecutive days. While BTC saw its first rally in the bear market, the price still has a way to return to the lower band of the Power Law Corridor.
For the price to do so now, the price needs to be just above the $35,000 range. Bitcoin price has never broken below the lower band line for a long time, which is unusual when looking at the 13 year BTC price cycles. The break shows that markets often follow specific mathematical laws, patterns, and patterns, but these types of technical approaches don’t always look right.
At the moment, the recent bear market rally and other factors suggest that a bottom is quite likely in this particular crypto winter, but since charts and signals like this have broken in the past, that means no one can really guarantee that the bottom of the crypto market is at .
What do you think of all the bitcoin price patterns that have broken in the past? Tell us your thoughts on this topic in the comments section below.
photo credits: Shutterstock, Pixabay, Wiki Commons, lookintobitcoin.com, Twitter, bitcoinwisdom.io,
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