1) Below previous cycle high
Bitcoin hasn't breached the previous high in the past, so the chances of it going below 20K are relatively low imo. (If we assume 65K was the cycle top)
However, if we see a huge correction in the US stock market, this scenario cannot be ruled out.
2) 300W SMA
If we switch to weekly chart and draw 300W SMA's, reaching our support line goes below 300W if it takes a year to reach bottom out. (projected in chart based on previous cycle time)
BTC Price has never gone below 300W in the past, however it did wick to it during Mar 2020.
3) For 300W SMA to match our support line
For the 300W to match out 84% drop horizontal line, the price needs to fall to ~ 10200 in Mid Oct. (half the time of the previous cycle time to bottom)
I might be a vicious drop triggered by external event (may bounce back sharp):
Possible causes:
- FED interest rate hike (If inflation runs rampant)
- US stock market crash (after effect of ^, or any other reason)
- Govt regulations in crypto
- Govt reducing/ stopping stimulus cheques (eventually will)
- More waves of virus spooking markets (stock market then cascading to crypto)
I personally see direct correlation between stocks and crypto (Dec 2018 + Mar 2020) , I haven't seen any evidence that suggests inverse relationship playing out during a big correction in stocks.
So it is hard to imagine crypto holding value when stocks correct
DISCLAIMER: Not a trader or technical analyst, I just post an idea when I observe something interesting