With just around 213 days left till the next halving event, which will see the mining reward of the world's preeminent cryptocurrency cut in half to just 3.125 BTC and pave the way for a potent deflationary price upthrust, crypto enthusiasts are eagerly waiting for Bitcoin's expected bullish wave to eliminate the current bear market purgatory. However, before that widely expected relief is able to materialize, it seems that the bears are about to have one final laugh at the expense of the cryptocurrency's bulls.
Bitcoin is 210 days away from the Halving in April 2024
At this point in the cycle in 2019, $BTC performed a relief rally to form another Lower High
And in the months that followed, Bitcoin dropped -62% to reach its Macro Higher Low
Right now, it looks like BTC is also… pic.twitter.com/1EWwASBuld
— Rekt Capital (@rektcapital) September 22, 2023
As explained by Rekt Capital in the above X thread, in the runup to its halving event, Bitcoin customarily undergoes a relief run followed by a significant price plunge that ushers in the cycle's "macro higher low." For instance, back in 2019, when the world's largest cryptocurrency was around the same temporal distance away from that cycle's halving event, Bitcoin went through a sizable rally followed by a 62 percent price plunge.
Currently, Bitcoin appears to be in its relief run phase. If historical precedents hold true, the preeminent cryptocurrency is due one significant price plunge before the bulls can finally assume command. Given this cycle's idiosyncratic factors, Bitcoin need not plunge by as severe a magnitude to create its cyclical higher low. As per Rekt Capital's calculations, a 27 percent plunge from the current ~$26,000 price level to around $19,000 will fulfill the conditions required for this capitulation.
Do note that Bitcoin's fair value, which takes into account the summation of energy deployed on the network, is currently hovering at around the $46,000 price level. Moreover, with the court recently ordering the SEC to re-examine Grayscale's application for converting its Bitcoin Trust into a spot ETF after having rejected the apex financial regulator's misgivings, it appears quite likely that we will see a plethora of spot Bitcoin ETFs launching in the near future, paving the way for a significant influx of capital and the attendant price jump.
On the flip side, the growing regulatory noose around Binance is playing its role in dampening the overall sentiment in the crypto sector.
Do you think Bitcoin will ever be able to create a new all-time high? Let us know your thoughts in the comments section below.
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