Bitcoin, the leading cryptocurrency asset, has been showing significant momentum lately, with a rise above $70,000 after a recent downward trend. Rekt Capital, a well-known cryptocurrency expert, has drawn attention to a pattern that resembles the pre-halving retrace that occurred in 2020 before Bitcoin surged to its previous all-time high. Despite the uncertainty in the crypto market, Rekt Capital suggests that the recent pullback might have come to an end, comparing it to the 2020 pre-halving retrace.
In the current cycle, Bitcoin has experienced a pullback of over 18%, similar to the retrace of over 19% in the 2020 cycle. This similarity raises the possibility of Bitcoin replicating the 2020 movement in the current cycle. Upon further analysis, it was observed that Bitcoin has been contained within a weekly range since the 18% retracement. The weekly range, formed by the upside-wicking 2021 peak and the candle-bodied 2021 peak, indicates a crucial level for Bitcoin’s price action.
Signs of Recovery
Rekt Capital points out that reclaiming the $69,200 ‘range high’ as support, which has already occurred, could signify the end of the recent decline and pave the way for Bitcoin to break above its weekly range. As Bitcoin struggles to regain its recent peak of $73,000, there are speculations that the recent price increase could mark the conclusion of the pre-halving retrace. With Bitcoin’s price hovering around $70,806 at the time of writing, showing a 5% daily increase, there are signs of bullish momentum building up.
Factors Driving Bitcoin’s Growth
One of the key drivers of Bitcoin’s growth in this cycle has been the approval of spot BTC ETFs in January 2024. This regulatory development has opened up a new channel for investors to gain exposure to Bitcoin’s price movements without directly owning the digital asset. The approval of the ETFs has led to increased adoption from institutional investors and a surge in capital inflows, contributing to Bitcoin’s price surge from $46,000 to $73,000.
Another crucial factor influencing Bitcoin’s price is the anticipation surrounding the upcoming Bitcoin Halving scheduled for April. Historically, such halving events have resulted in significant price rallies for Bitcoin as investors position themselves to capitalize on the event. As a result, investors are closely monitoring Bitcoin’s price action to gauge the potential gains post-halving.
The analysis of Bitcoin’s recent movement and the comparison with past cycles suggest that the cryptocurrency is poised for further upside potential. With key levels being reclaimed and bullish momentum building up, Bitcoin’s price action in the coming days will be crucial in determining its trajectory. As investors brace themselves for the upcoming halving event and monitor regulatory developments, Bitcoin’s price movement is likely to be influenced by these factors in the short to medium term.
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