Analysts Warn That Bitcoin (BTC) Could Face Similar Bearish Fate as Litecoin (LTC) in The Upcoming Halving – Report

  • Bitcoin’s price rally in 2023 has been more influenced by macroeconomic events and its correlation with US tech stocks than the period since the last BTC halving. 
  •  Renowned analyst Ali Martinez predicts a stable long-term BTC uptrend, while TradingShot highlights a golden cross pattern signaling a potential bull rally to $69,000. 

Before Litecoin halving, its price surged to a multi-month peak, and the actual halving acted as a “buy the news, sell the rumor” situation. Subsequently, the LTC price sharply declined. NYDIG, a Bitcoin company, predicts a similar weakening trend during the upcoming BTC halving.

The Bitcoin halving is an eagerly awaited milestone for traders and market participants. Occurring once every four years, it halts the mining reward for a BTC block, effectively reducing the circulating supply. Traditionally, this has led to higher prices due to decreased supply, but experts have noticed a shift in this trend.

The potential of a BTC halving acting as a bullish catalyst for its price is diminishing. NYDIG experts observed weakening trends in the low-to-high and high-to-low returns of the past two halving cycles. Litecoin, which was created by forking the Bitcoin blockchain, also exhibited a similar pattern.

In the case of Litecoin, the last two halvings failed to spark a price rally. Instead, they resulted in a decline in LTC’s market capitalization as its price dropped after the event. In 2023, macroeconomic events and Bitcoin’s correlation with US tech stocks have stronger influenced Bitcoin’s price rally than in the period since the last BTC halving.

Suppose halving events no longer have the same impact on driving BTC prices higher. In that case, investors will likely closely monitor macro events and Bitcoin’s correlation with stocks to understand the asset’s future direction.

Stable Uptrend Predicted: Crypto Analyst Ali Martinez’s Insights

Bitcoin (BTC) has been experiencing a robust consolidation phase, hovering around the $29,000 mark, leading to uncertainty among investors due to the subdued price volatility.

Nonetheless, on-chain data reveals a positive development in the network activity of Bitcoin. Despite the recent correction from $32,000 to $29,000 in the BTC price, the number of new Bitcoin addresses continues to increase. According to renowned crypto analyst Ali Martinez,

This bullish divergence between price and network growth hints at a stable long-term BTC uptrend. Buy the dip!”

In addition, other on-chain indicators are also pointing towards a bullish momentum for Bitcoin. Martinez clarifies that significant BTC oscillators, including MVRV, aSOPR, Puell Multiple, and Reserve Risk, remain above the 0 line. This suggests that the current price correction may be only a temporary ‘blip’ and not a significant downturn.

TradingShot’s Golden Cross Analysis: Bitcoin Shows Promising Signs of a Bull Rally

On August 4, a crypto trading analyst named TradingShot posted on X, highlighting that Bitcoin has recently surpassed the golden-cross indicator for the third time in history. This development could mark the commencement of a new bull rally, potentially propelling Bitcoin to yet another record-high level.

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The golden cross pattern occurs when a short-term moving average, like the 50 DMA, surpasses a long-term moving average, such as the 200 DMA. This signals a favorable trend for cryptocurrency. In the past, during the two previous instances of a golden cross, the BTC price experienced substantial rallies shortly after.

Drawing from previous Golden Cross cycles, TradingShot pointed out that the next target for Bitcoin’s price would be its current all-time high of $69,000. According to him, it is reasonable to estimate that Bitcoin could reach this ATH by around the same time next year.

It’s worth noting that the unique circumstances of the March 2020 COVID-19 crash, which resembled a Black Swan event, temporarily disrupted the usual pattern. Experts anticipate the upcoming Bitcoin halving in 2024 might initiate a new market cycle. However, in the short term, there are concerns that Bitcoin’s price may dip below $29,000.


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About the Author: Daniel