Bitcoin (BTC) had an exceptional first quarter, marking one of its strongest performances in the past three years. However, experts are warning that this could result in significant volatility leading up to the Bitcoin halving.
In a post on April 3, crypto analyst Phoenix Desmond cautioned his 11,700 followers about the possibility of unusual price movements as the halving approaches. During the first quarter of 2024 (Jan. 1 to March 31), Bitcoin saw a 64% increase in price, making it the third-best quarter in the last three years, according to Kaiko Research data. Starting at $44,172 on Jan. 1, its price rose to $71,255 by the end of the quarter.
Desmond argues that the consistent pattern of outperforming price performance in weekly and monthly closings indicates unprecedented market conditions. He stated, “Never before have we seen such a strong weekly, monthly, and quarterly close above previous ATH only to retrace so far so fast.”
In the last two weekly closes, on March 17 and March 31, Bitcoin experienced a 6.09% surge, climbing from $67,234 to $71,333, according to Yahoo Finance data.
The Bitcoin halving, set to occur on April 20, is just 16 days away. Speculation is growing that it could trigger further upward movement in the second quarter of 2024 due to the expected supply shock. However, investor sentiment regarding Bitcoin’s short-term price direction appears to be neutral.
CoinGlass data reveals that liquidations on both short and long positions remained relatively balanced over the past 24 hours, totaling $16.27 million and $16.77 million, respectively.
If Bitcoin’s price rises by just 1.5% to $66,687, approximately $57.08 million worth of liquidations will occur. Conversely, if it drops by 1% to $65,013, $35.14 million will be liquidated.
Rekt Capital, a popular pseudonymous crypto analyst, believes that Bitcoin may not follow the same trajectory as the previous quarter. At best, it could encounter resistance levels close to the all-time highs of the first quarter. In a post on X on March 3, Rekt Capital stated, “BTC may consolidate between $60k & $70k for the coming weeks going into the Halving and beyond.”
While the launch of spot Bitcoin ETFs by several of the world’s largest asset management firms on Jan. 11 has generated interest and speculation about Bitcoin’s price, some foresee a potential shift in the narrative. MN trading consultancy founder Michael van de Poppe told his 710,600 followers on April 4, “Most likely not Bitcoin.”
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