Bitcoin (BTC) has just declined below a key trend line support. It has now seen a clear break below the 38.2% fib level and risks a much lower decline down to the 61.8% which would see BTC/USD find temporary support around $7.7k even under the bullish case. It is important to note that all of this is shaping up to be more like 2014 not only for Oil but also for Bitcoin. We saw both markets decline heavily in 2014 when Saudi Arabia and Russia could not reach a deal on production cuts. The same seems to have happened last Friday and with the recent slump in oil, it appears that we might be once again headed that way.

For the past two years, I have been repeatedly saying that we might be looking at a 2014 styled crash in BTC/USD. All of that seems to be in play now as we are looking at a 2014-styled slump in WTI Crude Oil (USOIL) which could take down Bitcoin (BTC) with it. This would be a devastating development for the entire cryptocurrency market and we might see the market return to a pre-2016 stage leading to altcoins entering a prolonged bear market against Bitcoin as the Altcoin dominance (Others.D) trend reverses. This is an alarming development if we think about what it means. It could put the future of the entire cryptocurrency market at stake. We are looking at a decline down to $1k or lower in Bitcoin (BTC). This would absolutely crush the vast majority of altcoins that exist today and potentially change the working of this market. We could see cryptocurrencies decouple leading to Bitcoin and tokens being different markets.

The price of oil has declined massively the past few weeks and there seems to be no sign of a slowdown. Recent Saudi-Russia talks on oil production cuts failed and the price took a major hit on Friday. The intent here seems to be to put further pressure on the US Shale Oil industry. So far, it seems to be working effectively. If this continues, it could lead to a full-scale oil war which would see the prices slump in a similar manner as they did in 2014 which might pull BTC/USD down with it.

The weekly chart for WTI Crude Oil (USOIL) shows that the price has plunged below a large symmetrical triangle. This means that we might be at the beginning of a major downtrend, one that could see the price of oil decline massively from here. The Coronavirus situation is also getting worse which has and would further reduce demand for oil. This along with the future of technology, electric cars and less reliance on fossil fuels continue to threaten oil prices. We could see the slump continue and it is very likely to drag Bitcoin (BTC) down with it.