Navigating the Pre-Halving Bitcoin Scenario: Insights and Expectations

Bitcoin halving

BTC price analysis

Pre-Halving phases

Written by

Dreko

Published on

Apr 09, 2024

Final pre-halving Bitcoin update:

At the time of writing this article, the Bitcoin (BTC) halving is estimated to take place in approximately 10 days, landing on April 18, 2024. In this article, I will review why the price of BTC has been held back, what BTC has done around the halving in the past, and what we could expect from the BTC price going forward.

Why is the price of BTC still ranging around $70,000 and when will it break out?

The following is a summary of three twitter threads that discuss the current state of Bitcoin, and where it may be headed.  These threads were created by Rekt Capital, Stockmoney Lizards, and Mags.  Many analysts state that Bitcoin has three (3) phases surrounding the halving.  These phases are:

1. Pre-Halving Retrace

Typically, the pre-halving retrace tends to occur between 28-14 days before the halving. In 2016, this Pre-Halving retrace was -38% deep and lasted 3-4 days

In 2020, this Pre-Halving retrace was -20% deep and lasted 56 days (8 weeks)

Currently, $BTC is just over 14 days away from the Halving, pulled back -18% in total over the past couple of weeks

If the Pre-Halving Retrace bottom is in, we experienced a -18% retrace that lasted approximately 7 days during this cycle, and we are currently slowly climbing out of the retrace as we speak. 

The goal of a Pre-Halving Retrace is three-fold:

a) To offer one final bargain-buying opportunity in the Pre-Halving period

b) To form the Range Low of the future Re-Accumulation Range

c) To set up the next phase in the Bitcoin Halving Cycle

2. Re-Accumulation

The beginning of the "Re-Accumulation" phase occurs once the Pre-Halving Retrace has bottomed.  It is likely that we have already and we are already beginning to see this phase play out.  If history repeats itself, we can expect Bitcoin to range sideways more or less for the next few weeks, up to 150 days.  Many people can potentially get shaken out during this phase due to the lack of volatility or major results (gains).  But, this cycle is different because this is the first time BTC has had a new all time high (ATH) before the halving, and this is the first time BTC has had regulatory clarity and large institutional buyers with the ETF. 

3. Parabolic Uptrend

Once Bitcoin breaks out from the re-accumulation area, it will move onto the parabolic uptrend area.  It is during this phase that bitcoin will grow at an accelerated rate.  Historically, this phase has lasted between 400-500 days before the top of the market is in.

What can we expect next?

It is always good to remember that nothing goes up in a straight line.  There will be some volatility and pull backs along the way.  According to Stock Money Lizards, we could be seeing a Running Flat Correction pattern that would bring us to the upside after testing the range low one more time.  Either way, Bitcoin is on pace to set another all time high in the near future, and potentially see a slight pull back before we continue upward. 

But what about after this phase?  Well, we can only look at history to make potential projections for Bitcoin performance.  In a tweet posted by Mags,

In 2012, BTC moved sideways on the halving day and then pumped from $12 to $1166 after the halving. That's a 9500% increase in just 380 days.

In 2016, BTC also moved sideways on the halving day and then dropped by -29% a few days after the halving, followed by a quick recovery. The price surged from $470 to $19600, marking a 4100% increase in just 500 days.

In 2020, BTC took a minor -17% dip just a few days before the halving, followed by a few months of sideways price action. Price pumped from $8700 to $69,000 in just 547 days.

In 2024, BTC is less than 2 weeks away from the halving. This is the first time the price has hit a new ATH before the halving and is currently consolidating near the ATH with one of the highest monthly close ever.

Whether we see sideways price action or a slight correction, one thing is certain - 

Bitcoin will likely trade much higher in the coming few months than its current level.

Dips are for buying , Don't get shaken out!

Sources:

Rekt Capital

https://twitter.com/rektcapital/status/1775890683553079391

Stockmoney Lizards:

https://twitter.com/StockmoneyL/status/1776143055793353141

Mags:

https://twitter.com/thescalpingpro/status/1776876306279641335?t=v_qr_VF69Ix4l2e55z5BGw&s=19

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