Bitcoin crossed the $71,000 mark on Monday as speculation intensifies as to whether it could reach $80K this US election cycle. Veteran trader, Peter Brandt is of the opinion that bitcoin post halving advance may has begun.
Bitcoin rise: the lows have ended?
In his analysis, Peter opines that the series of lower highs and lower lows that have been witnessed since March have come to an end. What this means is that if the follow-through is confirmed, bitcoin could be starting the post-having momentum.
Bitcoin’s price movement after every halving event has been studied over the past halving cycles in 2012, 2016, 2020. Every halving event creates more scarcity and is usually followed by a bullrun that breaches the previous all time high (ATH).
Halving events impact on bitcoin price
Every 4 years, or after 210,000 blocks, the bitcoin network cuts the rate of new coin emissions by 50%. The first halving event reduced the coin’s issuance from 50 to 24 BTC per block (approximately every 10 minutes. The second event in 2016 reduced further to 12.5btc per block. In 2020 from 12.5 to 6.25 and last one in April 2024 to 3.125 BTC.
In the previous 2 halving (2016 and 2020), bitcoin had three months of straight upside in October, November, and December. Generally, it takes rightly 3 months after halving for Bitcoin to record a new ATH. However, some other factors may impact the price momentum. For example, the 2020 halving was in the midst of COVID-19 pandemic. There was also economic uncertainty in the world. This makes the 2020 and 2016 halving a bit different. In 2016, after halving the price dropped and stayed down for 4 months before getting back even. In 2020 on the other hand, the price stayed flat for about 2 months. Currently, in 2024, we are over 6 months after the halving in April 20, 2024. Going by the table chart above, we are between 150-250 days after the halving period which usually sees the biggest price jumps.
Source: Crypto is Easy newsletter
Source: Rekt Capital.
Looking ahead, despite these positive prospects, it is important to note that bitcoin and crypto in general does not exist in a vacuum. Macroeconomic factors, geopolitical events and prevailing market sentiments can have an impact on bitcoin price. Nonetheless, using a combination of historical data with some fundamental analysis, we can make informed inferences.
