As the halving event draws closer, investors are closely monitoring Bitcoin’s price movements. Despite a slight dip in the middle of the week, BTC is steadily approaching $70,000, with a 2.3% gain in the past day.
Analysts believe that BTC bulls need to push the cryptocurrency past the $70,000 resistance level before the halving occurs. This will confirm an upside breakout from the pennant pattern that Bitcoin has been trapped in since late February.
Bitcoin’s performance this year was always going to hinge on two major events: the SEC’s decision on the ETF in January and the upcoming halving in April. The first event has already passed and it propelled BTC to its all-time high of over $73,000. The next event is just 12 days away, and analysts have differing opinions on how it will impact the price.
Currently, Bitcoin is trading at $69,550, with a 2.2% gain in the past day, despite a 32% drop in trading volume. While it started the week above $70,000, the top cryptocurrency dipped below $65,000 on Tuesday before rebounding. It now appears poised to regain crucial support above $70,000. Year-to-date, BTC has gained 64% due to the influence of ETFs and the overall market rally.
The upcoming halving event is one of the most significant occurrences in the Bitcoin ecosystem. Analysts are still divided on how it will affect BTC’s price. In 12 days, the block reward will be reduced from 6.25 BTC ($434,438) to 3.125 BTC ($217,219).
Steno Research, a Danish macro research company, predicts that Bitcoin will experience a “buy the rumor, sell the news” scenario. This means that the price of an asset surges as it approaches a major event, such as being listed on a major exchange or receiving approval from regulators, but then experiences a significant drop afterwards.
Steno’s analysts expect the price of BTC to surge over the next 12 days, as shown in the graph below, which demonstrates that BTC has always spiked as the halving approaches.
[Graph]
However, immediately after the halving occurs, BTC is likely to remain subdued before appreciating over the next year. This pattern has been observed in the previous three halvings.
“Nevertheless, it is important to emphasize our optimistic long-term perspective: the halving is highly bullish for Bitcoin. We anticipate that the anticipated reduction in selling pressure from miners will fundamentally strengthen Bitcoin’s price,” the researchers stated.
They further added:
“We believe that the true bullish momentum of the halving will become evident once the initial market adjustments have settled and the ‘weak hands’ – investors who bought in with the expectation of quick gains, including some ETF investors – have exited. The long-term positive effects of the halving on Bitcoin’s price are expected to materialize after this initial phase of downward pressure.”
In the short term, one analyst, known as Captain Faibik to his 88,000 followers on X, suggests that BTC needs to break above the $70,000 resistance level in order to maintain its bullish momentum. He notes that Bitcoin has been stuck in a pennant pattern since early March, where the price experiences a sharp movement followed by consolidation. If BTC breaks above the upper trendline, which is above $70,000, it is likely to sustain its bullish rally.
To summarize, the upcoming halving event is creating anticipation among investors, with differing opinions on how it will impact Bitcoin’s price. BTC is currently approaching $70,000, and analysts believe that breaking above this resistance level is crucial for maintaining bullish momentum. The long-term effects of the halving are expected to be positive for Bitcoin’s price, but an initial phase of downward pressure may occur after the event.