Bitcoin’s anticipated supply halving, along with its historical price trends, the increasing influx of funds into spot Bitcoin exchange-traded funds (ETFs), and a bullish technical setup all suggest that Bitcoin is on track to reach a new all-time high.
After a bullish year in 2023, the approval of spot Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) in 2024 led to a surge in the prices of Bitcoin, Ether, Solana, and other cryptocurrencies.
As Bitcoin surpassed $50,000, its market capitalization surpassed $1 trillion, reaching $1.02 trillion on Feb. 16, representing a 118% increase over the past year.
The price of Bitcoin has also increased by 110% during the same period.
Many traders believe that the upcoming halving event, which is less than 70 days away, plays a crucial role in Bitcoin’s price movement.
Bitcoin’s price tends to follow a cyclical pattern, with analysts drawing parallels between historical patterns and the current trajectory. This suggests the possibility of a bull cycle similar to those seen in the past.
Bitcoin’s previous bull runs have followed four-year cycles, often triggered by events such as the halving, which reduces the rate of Bitcoin issuance.
The next halving is scheduled to take place in mid-April 2024, when the number of Bitcoin rewards issued to miners per block will be reduced from 6.25 BTC to 3.125 BTC.
Historical data shows that halving events have had a positive impact on the price of Bitcoin, with bull runs starting months before the event and continuing until Bitcoin reaches a new all-time high.
Crypto trader and analyst Rekt Capital explains the “5 Phases of The Bitcoin Halving,” with the “Parabolic Uptrend” being the final phase where Bitcoin’s price grows exponentially, reaching new all-time highs.
Independent investor Lady of Crypto shares a similar sentiment, projecting that Bitcoin’s parabolic uptrend will take 7 to 8 months after the halving, with Bitcoin breaking all-time highs in November 2024.
Investment manager Timothy Peterson agrees with this view, while others believe that the 2024 halving could be different.
Capital continues to flow into spot Bitcoin ETFs, with data showing that $4.5 billion has been invested in Bitcoin ETFs since they started trading on Jan. 11.
While outflows from GBTC initially exceeded inflows into the new ETFs, this situation has changed, with BlackRock’s IBIT experiencing one of the most successful ETF launches in history, surpassing 100,000 BTC in assets under management (AuM) on Feb. 13.
Demand for Bitcoin ETFs has accelerated, with an average of $450 million in daily inflows recorded this week. As of Feb. 16, all spot Bitcoin ETFs had a total AuM of 258,770 BTC, equivalent to around $13.4 billion at current rates.
Tristan Dickinson, Head of Marketing and Communications at dYdX Foundation, stated that the rapid adoption of Bitcoin ETFs has contributed to Bitcoin’s rise above $50,000.
Bitcoin’s technical setup also indicates bullish potential. The price chart has formed a rounded bottom pattern on the weekly chart, with buyers aiming for the neckline at $69,220, which coincides with the all-time highs reached in November 2021.
A weekly candlestick close above this level would confirm a bullish breakout, propelling Bitcoin into price discovery.
The relative strength indicator (RSI) for Bitcoin has entered the overbought zone, approaching the 80-point mark, further affirming the dominance of bulls in the market.
The Exponential Moving Averages (EMAs) have also produced a bullish crossover on the weekly chart, occurring in early January when the 100-week EMA crossed above the 200-week EMA.
Trader Aksel Kibar has identified an ascending parallel channel on the weekly chart, predicting a rally to $65,000 and beyond if the price breaks above the channel.
This article does not provide investment advice or recommendations. All investment and trading decisions involve risks, and readers should conduct their own research before making any decisions.