To form a bitcoin price prediction analysts generally look at previous market patterns and events. The two halvings that have already occurred may offer some indication as to what will happen after the next one, and there might not be the big pump that is expected.
Weekend trading has been good for bitcoin which has touched $10k once again. The move didn’t last long however with a rapid rejection at that level and a plunge back to $9,600 before BTC finally settled just below $9,800.
The chart displays another ‘Bart Simpson’ formation as bitcoin begins the week consolidating in the high $9k zone. The uptrend will not be resumed though unless there is a new higher high above $10,500 and analysts are already talking of a retrace back to $9,300 this morning.
Bitcoin Halving Hopes
With less than 78 days to go to the halving, the debate is raging on as to whether prices are already factored in or not. Opinion is pretty evenly divided between those that believe prices are not factored in and there will be a pump, and those that think the opposite will occur.
Binance boss Changpeng Zhao appears to be leaning towards the latter group with a recent post depicting charts that show flat markets following previous halvings.
“History may not predict the future, and correlation does not prove causation… Watch what happens AFTER halving. Markets are inefficient, at least, historically.”
History may not predict the future, and correlation does not prove causation.
Here are just 2 charts around the previous #bitcoin halving. Watch what happens AFTER halving. Markets are inefficient, at least, historically.
Just data, draw your own conclusions. pic.twitter.com/AwChmAGvrK
— CZ Binance
(@cz_binance) February 23, 2020
Markets did indeed remain flat for several months following the first halving in 2012. Only in 2013 did they start to run with an epic gain of around 8000% from $13 to over $900.
A bear market followed in 2014 then momentum started to build the following year in the lead up to the 2016 halving. Following that one there was very little activity until 2017 when momentum started building again and bitcoin surged from around $1,000 to over $20,000.
2018 was a bear market and 2019 saw slow growth which has continued into this year. If history rhymes BTC could retreat back to the $6-$8k area for the rest of 2020 before skyrocketing to a new all-time high in 2021.
Based on these charts it would be fair to say that bitcoin halving events induce bullish markets the year before and the year after but not the year of the event.
We could be in for a wild ride in 2021 but do not hold your breath for a massive rally for the rest of this year.
Will bitcoin trade flat after the halving? Add your price predictions below