Renowned analyst Lark Davis looks back to see if Bitcoin (BTC) can hit six digits this year.

Davis says Bitcoin’s current price action is reminiscent of Ethereum’s 2017 bull run.

“Is there a precedent for an asset to appreciate in value, followed by a sustained brutal correction, followed by a nice discount later in the year? Yes, please.

Ethereum almost made it [chính xác] that in 2017, which ended the year 237% above the local top. “

Davis also shares a chart comparing return on investment (ROI) over previous crypto cycles from analyst Benjamin Cowen.

“I also like Ben Cowen’s Bitcoin Cycle ROI chart. Either this is the shortest cycle with the lowest ROI or Bitcoin is experiencing another spectacular rally. “

Bitcoin Cycles ROI Chart | Source: Ben Cowen

Using the Greed and Fear Index as a reference, Davis says the sentiment among traders has been completely negative for the past two months.

“The negative sentiment shows that Bitcoin is very bearish. I can provide a lot of evidence from my comments here and above [YouTube], a lot of people are very pessimistic.

In fact, BTC’s Greed and Fear Index has been below 30 for over two months! “

History of Greed and Fear Index for the past year | Source: alternative.me

The indicator’s creator says that “extreme fear” in the market could indicate that traders are overly pessimistic.

Davis said BTC and the crypto market still need a catalyst to spark a new and sustainable rally.

“BUT what Bitcoin really needs is new fuel for the bull market.

Defi summer 2020 is a fuel.

Institutional purchases were the driving force behind the price gains in the fourth quarter of 2020 and the first quarter of 2021. “

SN_Nour

According to Dailyhodl

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