Will Bitcoin vigorously “pump and dump” again this January?

One of the most common principles of crypto trading is: “Past performance is never an indicator of future success.” However, if the same pattern occurs almost exactly at the same time three years in a row, it is easy to question the validity of this statement.

In this case, it’s about Bitcoin (BTC) experiencing a significant pump in early January in the past three years, ranging between 10% and 24% in the first week of the new year.

When Bitcoin Goes Up …

With profits of up to 24% in the past three years in a row, it seems reasonable to assume that similar profits are certain for 2020. Unfortunately, this is not guaranteed as the markets rarely follow such a predictable pattern.

2017: 21.9% scam punp first week of the year.

2018: 24.3% scam punp first week of the year.

2019: 11.8% scam punp first week of the year.

2020: GIB 8200$ $BTC 😤 pic.twitter.com/9DLbpkV5t2

— SalsaTekila (JUL) (@SalsaTekila) December 30, 2019

Nevertheless, a value of around $ 9,050 could be reached within a week if one assumes that Bitcoin will repeat its 24.3% growth recorded in early 2018. Conversely, at the bottom of the range, an 11.8% increase in Bitcoin would push the value back to $ 8,590.

It was last seen in mid-November 2019. For this reason, it is certainly worth paying attention to the market in the next few days – just in case the trend repeats itself for the fourth time.

With Bitcoin and many other cryptocurrency markets largely driven by changes in trader sentiment, it wouldn’t be too surprising if this prediction turned into a so-called self-fulfilling prophecy. The expectation of an event leads to the event actually occurring.

In this case, expecting Bitcoin to rise in January could lead to increased investment, changing the dynamics of supply and demand at BTC and increasing the price.

… does he have to come down again?

Although Bitcoin has pumped three times in a row at the beginning of a new year, something else has shown an even stronger trend in recent years – and that’s not good news for many traders.

According to data from Twitter user @BohoCrypto, Bitcoin has experienced a significant dump in mid-January for the past five consecutive years. These dumps were large enough to wipe out the gains from the pumping in early January. They are considered the biggest dumps of the year.

1. 2015 (14 Jan) Dump from 320$ to 150$, which is 50%
2. 2016 (16 Jan) Dump from $460$ to $360$, which is 20%
3. 2017 (11 Jan) Dump from $1120 to $770,which is 35%
4. 2018 (16 Jan) Dump from 17500$ to $9700, which is 45%
5. 2019 (10 Jan) Dump from 4000$ to $3500,which is 15%

— BOHO CRYPTO (@BohoCrypto) December 30, 2019

Bitcoin has lost at least 15%, sometimes as much as 50%, in mid-January in the past five years. If this happens for the sixth time in a row, Bitcoin may drop to its lowest level since 2017. Still, those with a keen eye could make a significant profit from shorts during this time.

Although the reasons for this cycle remain unclear, some speculate that the frequent sell-off in January is a side effect of the Chinese New Year. During this time, bankrupt investors could sell their holdings to participate in Hong Kong Bao – the tradition of giving red envelopes with cash to friends and family.

However, it remains to be seen whether 2020 will follow one of the apparently more reliable Bitcoin market trends.