The Bitcoin Price Retraces Amid Selling Pressure
The price of Bitcoin has been retracing in today’s trading session, facing selling pressure that could potentially push it back to critical support levels. Currently, Bitcoin is trading at $27,400 with a 2% loss in the last 24 hours. Over the past week, the cryptocurrency has recorded a 3% loss, following the overall trend of the top 10 cryptocurrencies by market cap.
An Analyst’s Perspective on the Bitcoin Halving
Rekt Capital, a crypto analyst and trader, shared a thesis regarding the upcoming Bitcoin Halving. This event involves reducing the rewards miners receive for adding new transactions to the blockchain. In 2024, these rewards will be halved from 6.25 BTC per block to 3.125 BTC. The Halving is a significant event that directly affects the supply and demand dynamics of the BTC market.
Rekt Capital believes that Bitcoin tends to exhibit certain behavior as the Halving approaches. In 2019, after a period of downward trends and sideways movement, Bitcoin experienced a relief rally. The current upside momentum is seen as similar to this relief rally based on historical price action.
The Possibility of a Crash and Roadmap
While history rarely repeats itself exactly, Rekt Capital suggests that a crash from current levels or close to $30,000 could present an opportunity and serve as a roadmap for traders. Market participants should pay attention to any spike in trading volume as BTC reaches critical levels. Approximately two months before the Halving, an increase in volume could indicate an imminent rally.
Traders should watch out for the low levels highlighted by Rekt Capital as potential entry points before Bitcoin reclaims the area above $30,000. The chart analysis suggests that the cryptocurrency often breaks critical resistance levels near the time of the Halving.
Hot Take: Pre-Halving Rally and Accelerated Growth
According to Rekt Capital, a pre-Halving rally typically occurs around 60 days before the event. Investors “Buy the Hype” in anticipation of the Halving and then “Sell the News.” Once Bitcoin breaks out from the re-accumulation area and enters a parabolic uptrend, it experiences accelerated growth on its way to new all-time highs.
Cover image from Unsplash, chart from Tradingview
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