Bitcoin Follows Price Fractal From 1970s Gold
Over the last week, both Bitcoin and gold have rallied in the wake of widespread bank runs and failures. Gold is up roughly 10% on the year, while BTC is near a 70% return. With bank shares plummeting and the top cryptocurrency by market cap rising, BTC priced in banks makes for some of the most shocking and awe-inspiring price charts you could imagine. That shock and awe might continue, if a fractal BTC is following from 1970s gold continues to unfold. In the 1970s, the United States inflation rate reached over 10% and double-digits wasn’t uncommon through the early 80s. During the worst of it, gold went on to climb more than 750% from $100 to $850 per troy ounce of the precious metal. Now that same price fractal is potentially back in Bitcoin, and so is soaring inflation.
The Fastest Horse In The Race Against Inflation
During the 2020 bull run, billionaire investor and philanthropist Paul Tudor Jones famously said that Bitcoin could be the fastest horse in the race against inflation, referencing 1970s gold. Inflation had first reached double-digits in 1974, only three years after US President Richard Nixon announced that the United States would no longer be convertible from dollars to gold at a fixed price of $35 per ounce. Gold went parabolic, first experiencing a pullback in 1974 when inflation got overheated. After a two-year long correction, gold spent the next several years rallying by more than 750%. Bitcoin price also corrected hard when inflation first reared its head, but after two years is starting to show resilience. In the future, it could prove to be the digital equivalent to gold in the 1970s, helping investors beat inflation or a banking crisis. In the price fractal above, gold completed a wave 5 after an expanded flat correction, according to Elliott Wave Principle. In commodities markets, wave 5s tend to be extended. With BTC being classified by the SEC and CFTC as a commodity, could the crypto asset perform similarly? If BTCUSD were to follow the same path with a 750% return from recent lows, it would ultimately take Bitcoin to over $132,000 per coin. Could this be what’s ahead for the first-ever cryptocurrency?In Elliott Wave Principle, commodity wave 5s are the longest and strongest.
With #Bitcoin labeled a commodity by the SEC and CFTC, will it exhibit such commodity-like market behavior? Here is a comparison with #Gold in the 1970s. $BTC vs $XAU pic.twitter.com/I6ifTOtz8V — Tony "The Bull" (@tonythebullBTC) March 20, 2023
