Earlier today, Bitcoin (BTC) price peaked at $18,476 after an impressive 35% bull run that appears to have started in early September.
This powerful movement was followed by a correction to $17,000, a natural pullback. This adjustment led some investors to question whether the current formation resembles the $13,850 top formed in July 2019.
BTC/USD, July 2019. Source: TradingView
Back then, a 30% drop followed a similar-sized rally, and afterwards it took Bitcoin 14 months to regain the $13,850 level. Coincidently, an intense flash crash happened right after that local high, but the price eventually recovered and stabilized near $12,800.
If something similar happened this time around, investors would expect a $13,000 low for the current cycle. Apart from a flash crash following a strong rally, what other indicators mimic the July 2019 price action?
The first step is to analyze the futures basis indicator, which can be interpreted as investor optimism. Basis is also frequently referred to as