The price of Bitcoin has been on a downward trend since hitting a new all-time high of $73,000, ushering in a wave of speculation about the crypto asset’s next near-term direction.
Bitcoin’s recent dip has led to a general retracement in the crypto market in recent days. With the Bitcoin Halving event fast approaching, many crypto analysts expect a further decline in the price of BTC in the near future.
Bitcoin ready for “danger zone” ahead of halving
Popular cryptocurrency trader and analyst Rekt Capital has shared a dire forecast for Bitcoin with the crypto community on social media platform
The analyst’s prediction came in light of BTC experiencing a notable decline in recent days. According to the expert, Bitcoin will formally enter the danger zone in two days (orange).
This is the starting area of previous retracements seen ahead of the BTC halving, which is expected to take place in April. Prior to the halving, these retracements have consistently indicated intervals of substantial market corrections for the digital asset.
Rekt Capital further pointed out that the pre-halving retracements have historically been observed in BTC 14 to 28 days before the event. Bitcoin’s price witnessed a decline of around 40% prior to the halving in 2016.
Meanwhile, the crypto asset fell more than 40% in 2020 before the occasion. Currently, we are less than 30 days away from this year BTC halving occurs; However, the price of the coin has fallen by more than 11% in the past week, indicating further correction in the coming weeks.
The message read:
In two days, Bitcoin will officially enter the “Danger Zone” (orange) where historic Pre-Halving Retraces have begun. Historically, Bitcoin has performed pre-halving retracements 14-28 days before the halving. In 2020 this recoil was -20% deep, and in 2016 this recoil was -40% deep. Currently, BTC is 30 days away from halving and has retreated -11% this week.
It is noteworthy that the crypto analyst had previously established the time frame BTC is expected to peak in this bull cycle. Rekt Capital believes the asset will peak within 280-350 days. In concrete terms, this could happen around mid-December of this year or mid-February of next year.
4 different halving phases
So far, the crypto analyst has done just that marked Different Phases for the Upcoming Bitcoin Halving; these include the Pre-Halving Rally, Final Pre-Halving Retrace, Re-accumulation and Parabolic Uptrend.
According to Rekt Capital, there is usually one rally before the halving approximately 60 days before the event takes place. For the last retrace before the halving, it usually develops about 14 to 28 days ahead.
In addition, a reaccumulation period of several months follows the pre-halving. Finally, the parabolic uptrend begins once Bitcoin leaves the reaccumulation area.
Featured image from iStock, chart from Tradingview.com
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