Rekt Capital, a cryptocurrency expert and enthusiast, has done just that identified a similar pattern between the recent Bitcoin return before the halving and the one that took place in 2020 before the crypto asset witnessed a surge to the previous all-time high.
Bitcoin’s pullback is nearly identical to its pre-halving pullback in 2020
Bitcoin, the largest cryptocurrency asset, is currently showing momentum, rising above $70,000 and recovering from a recent downtrend. After the recovery, Rekt Capital believes the downturn may be over, citing a similarity to the 2020 pre-halving pull back.
Given the uncertainty in the crypto market, the analyst isn’t sure if the recent rebound marks the end of the pre-halving downturn. However, if that is the case, Bitcoin would have nearly matched the 2020 pre-halving correction.
According to the analyst, the digital asset has registered a pullback of over 18% in this cycle. Meanwhile, the price has returned more than 19% in the 2020 cycle, suggesting that the asset’s potential is mirroring the 2020 move in this cycle.
A further one to dive The correction made by the analyst shows that Bitcoin has been trapped within the weekly range (black-black) since retreating by more than 18%. Both the 2021 upside peak and the candle-bodied 2021 peak together form the weekly range that Rekt Capital has indicated.
Thus, he claims that BTC regaining the range high of $69,200 as support, which has already played out, could signal the end of the recent decline. Furthermore, this shows that Bitcoin is poised to surpass its weekly range and move higher.
As Bitcoin’s 2024 halving approaches, the cryptocurrency is struggling to regain its most recent peak of $73,000. However, there are rumors that today’s increase could mean that the pre-halving decline is coming to an end.
Considered catalysts for BTC’s strength this cycle
At the time of writing it is BTC has recovered to around $70,806, indicating a daily increase of more than 5%. The market cap and trading volume are also showing strength, rising 5.49% and 47.82% respectively over the past day.
It is thought that one of the main drivers of Bitcoin’s growth this cycle has been its adoption spot BTC ETFs in January 2024. With the product’s adoption, investors now have an easy way to profit from Bitcoin’s value without actually owning any of it.
Since then, the crypto asset has witnessed increased adoption by industry leaders and massive capital inflows, which has also increased its price. The BTC price has risen from $46,000 to a peak of $73,000 since the ETFs were approved by the US Securities and Exchange Commission (SEC).
Another catalyst that is believed to have influenced the price of the coin is the anticipation surrounding the upcoming Bitcoin Halving that will take place in April. In the past, these types of events have led to notable price increases. As a result, investors will shift their attention to BTC to position themselves for significant gains post-halving.
Featured image from iStock, chart from Tradingview.com
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