- Bitcoin, currently hovering around $26,600, has had analysts raising concerns about an impending price retrace to $20,000, drawing parallels to the 2019 pre-halving behavior.
- Rekt Capital, a noted crypto analyst, argues that Bitcoin might be entering a phase of Macro Higher Low in its current cycle that could culminate around early 2024.
- As Bitcoin is 210 days away from its next halving event in April 2024, this article explores whether Bitcoin needs another black swan event to plummet or if a 37% retracement will suffice.
Analyzing whether Bitcoin’s current price stagnation is a harbinger of an impending retrace to $20,000, in light of historical behavior and upcoming halving in 2024.
Bitcoin’s Uncertain Consolidation Above $27,000
After failing to sustain its position above the $27,000 mark, Bitcoin has stirred the crypto industry with increasing speculation about a retrace to the $20,000 level. Many experts find similarities in its present behavior to its pattern before the 2019 halving. At the moment, Bitcoin seems to be struggling with upper resistance lines, partially due to a lack of macro-positive news to propel it forward.
The Echoes of 2019: Rekt Capital’s Analysis
Crypto analyst Rekt Capital has laid out a compelling argument for Bitcoin’s potential downfall, drawing parallels to 2019. According to the analysis, Bitcoin may well revisit the $20,000 point, establishing it as a new Macro Higher Low. What’s notable is that this could occur around early 2024, coinciding with Bitcoin’s next halving event. A similar phenomenon was observed in the four-year cycle, where Candle 4’s downside wick formed a Macro Higher Low relative to Candle 3.
How COVID-19 Crash Alters the Equation
There are counterarguments suggesting that another significant drop is unlikely due to the ‘black swan’ COVID-19 crash of March 2020. However, Rekt Capital refutes this, stating that while a 72% crash may be improbable, a 37% retrace would be enough to establish a new Macro Higher Low, without requiring another unprecedented event. The analyst believes that the COVID-19 crash was a unique occurrence and that its magnitude shouldn’t be considered as a standard for future declines.
Countdown to Halving: What Can We Expect?
With the next halving event for Bitcoin only 210 days away, parallels to 2019 are becoming more pronounced. During the 2019 cycle, Bitcoin experienced a relief rally before establishing another lower high. Rekt Capital posits that Bitcoin might be in the middle of a similar relief rally currently, and that a 27% retracement from its existing price could be all that’s needed to hit its next Macro Higher Low.
Conclusion
While there are distinct patterns that make 2019 look like a shadow looming over Bitcoin’s current price movements, it’s crucial to account for other variables, such as upcoming halving events and previous unprecedented occurrences like the COVID-19 crash. Although Bitcoin seems to be wading through a phase of stagnation, the potential for a breakout—upward or downward—is palpable. Whether or not Bitcoin will retrace to $20,000 remains uncertain, but market indicators and expert analyses like that of Rekt Capital suggest that caution and close observation are advisable for investors in the coming months.
