Bitcoin Breaks $65,000, Analysts Predict Post-Halving 'Danger Zone' Is Over
Summary:
Bitcoin's price surpassed $65,000 on May 6, indicating that the post-halving "danger zone" may be over, according to analysts. As this period often sees volatile downside, its potential end, coupled with Bitcoin's rise above the $60,000 re-accumulation range, is a positive sign for the cryptocurrency. Commentators expect even more BTC growth due to potential interest rate reductions and revived ETF demand. However, short-term fluctuations might still occur due to concerns over inflation.
On May 6, the price of Bitcoin (BTC) surpassed the $65,000 threshold. This has led analysts to believe we might have exited the precarious period following its halving, with expectations of continued growth for Bitcoin. Crypto-enthusiast Rekt Capital believed that in the weeks after halving, Bitcoin was typically susceptible to a downturn; it would dip below the range of re-accumulation. Given Bitcoin's recent boost beyond the re-accumulation range of roughly $60,000, Capital is of the opinion that we may have moved past this phase of vulnerability.
Drawing on historical data from the 2016 bull run, Capital noted a trend of Bitcoin dipping 11% 21 days post-halving, preceding a price uptick. He noted a less dramatic 6% decrease during this cycle, which could suggest the phase of lowered Bitcoin prices is over.
Another expert, Willy Woo, has also predicted positive growth for Bitcoin, referencing the Volume-Weighted Average Price (VWAP), a commonly-used metric among traders. The Crypto Fear & Greed Index indicates an increase in investor optimism, moving from "fear" to "greed" within four days.
A significant drop in outflows from 11 American Bitcoin ETFs could be a driving force behind Bitcoin's current market correction. The last week saw the highest volume of outflows since the ETFs were launched, reaching nearly $900 million in total.
Moreover, data suggests that long-term holders may have ended their selling sprees at the $70,000 mark, potentially initiating a renewed period of active accruement. Axel Adler Jr of CryptoQuant believes this could lessen the selling pressure on Bitcoin, allowing for a steady ascension to new market highs. Echoing his sentiment, Eitan Katz, Kima's founder, believes that lessened selling pressure could invite new investors and promote market growth.
However, Mithil Thakore, CEO of Bitcoin's native liquidity protocol, Velar, warns that short-term fluctuations might persist due to inflation worries and anticipation of rate cuts. Despite this, Thakore optimistically predicts Bitcoin will hit the $100,000 mark by the end of 2024, driven by potential interest rate reduction, revived ETF demand, and advancements in Bitcoin's Layer 2 solutions.
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Published At
5/6/2024 9:35:00 PM
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