- The local top at $13k-$14k got confirmed by the NVT .
- Looking back in history, we see that after this event happened a severe correction was due along the next weeks/months, pushing price down between 50%-70% which would bring us into the $4k-7$k range.
Alternatively, a more classical interpretation could suggest that not so deep retracements are needed to alleviate the overextension.
To the point that the Bitcoin network matures, the corrections might soften compared to the ones we've experienced in the past.
Therefore we have 2 scenarios to consider:
1) This time is NOT different scenario, which would bring BTC back into the $4k-$7k range.
2) And the This time IS different scenario, which would be content with a softer correction and seeing BTC bottoming in $8k area.
Please note that both scenarios assume printing a higher low above the $3100 December lows.
So, all in all, that's a good thing to build a proper market structure to support the next up move beyond all-time highs at $20k.
NOTE: I’ve plotted the information on a 3-day chart for better visualization. But the NVT data is based on daily candles.
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