Is The Bitcoin Halving The Key For A BTC Price Bottom?

Share This Post

Bitcoin is still holding above $20,000 despite a massive increase in selling pressure over the past few days. The cryptocurrency has experienced some of the worst capitulation events in its history and could be read for a fresh leg-down.

Related Reading | Bitcoin Exchange Reserve Spikes Up, Selloff Not Over Yet?

At the time of writing, BTC’s price trades at $20,700 with a 7% and 31% loss in the last 24 hours and 7-days respectively. Market participants seem to be expecting new highs, but a resume in bullish momentum could catch them off guard.

BTC trends to the downside on the 1-day chart. Source: BTCUSD Tradignview

A pseudonym trader believes that the key to finding BTC’s price next major bottom is the Bitcoin Halving, the event that cuts this network block rewards in half every 4 years. The analyst claims that during a drawdown, the cryptocurrency finds a bottom “780-889 days after its previous” halving.

Currently, the Bitcoin network is at 766 days away from this event as it approaches a critical support zone. As seen below, when these two events coincide, BTC’s price can resume bullish momentum and reclaim previous highs.

Source: CryptoKaleo via Twitter

The analyst claims that the halving is part of a bullish thesis for Bitcoin as the cryptocurrency reduces its issuance, and there is less BTC available in the market. Conversely, BTC’s adoption levels trend to the upside.

The analyst shared a chart from Blockware Solutions. As seen in the chart, BTC’s price seems directly correlated to the percentage of the population adopting it and indirectly correlated to its supply issuance.

This is the ultimate bullish case for Bitcoin in one simple visual.

Exponentially growing user growth juxtaposed with Bitcoin's pre-programmed increasingly deflationary monetary policy. pic.twitter.com/s7S48K5YDt

— Will Clemente (@WClementeIII) June 9, 2022

Claiming that the world is “still early” on Bitcoin, the analyst added:

Why does the halvening model have any validity, and where does the imaginary logarithmic support curve come from? Simple supply and demand economics. The block reward is the vehicle for Bitcoin total supply inflation. BTC miners provide constant sell pressure into the market.

Should You Go All-In On Bitcoin?

Despite this thesis, the analyst claims that BTC could still face a lot of volatility and a lot of rangebound movement. In addition, BTC’s price could take time to form a convincing bottom.

Related Reading | Bitcoin Bounces Back Before Hitting 2017 Peak, Is The Bottom In?

The analyst said the following on BTC’s price potential to re-test new lows:

So, while we may still go lower – and as we may see a liquidation cascade as ugly as we’ve seen since March of 2020 when $20K finally breaks, I believe from a timing perspective – the bear market bottom isn’t as far away as it may currently feel.

Read Entire Article
spot_img
- Advertisement -spot_img

Related Posts

$40 XRP? Analyst Reveals Key Insights Suggesting Major Uptrend Ahead

A crypto market analyst recently released a study that predicts a big rise in the price of XRP This study fits with the current excitement in the crypto community, especially since Elon Musk made his

What happens to Polymarket bets if result of US Election is contested?

The decentralized prediction market platform Polymarket has clear outlines for resolving bets on the 2024 US Presidential Election in the event of contested results The platform’s market,

QCP Capital Analysts Highlight Impact of US Elections on Crypto Markets

QCP Capital’s latest market update highlights the influence of the upcoming US elections on financial markets, with a particular focus on cryptocurrencies like bitcoin (BTC) Analysts predict

Bitcoin network’s all-time high hash rate pushing mining difficulty upward

Bitcoin mining difficulty has reached a record high, driven by an unprecedented surge in the network’s seven-day moving average hash rate On Oct 21, data from Blockchaincom revealed that

Bitfufu Expands to Africa: Acquires 80MW Bitcoin Mining Facility in Ethiopia

Nasdaq-listed cloud mining services company Bitfufu has announced an agreement to acquire a majority stake in an 80-megawatt (MW) Bitcoin mining facility in Ethiopia This strategic move marks a

Ripple’s Brad Garlinghouse joins crypto leaders in backing John Deaton over Elizabeth Warren

Ripple CEO Brad Garlinghouse has publicly endorsed pro-crypto lawyer John Deaton‘s campaign to unseat Senator Elizabeth Warren and become the next senator from Massachusetts On Oct 22,