An analyst who accurately called Bitcoin’s pre-halving pullback this year is mapping out what he believes could be the most bearish price path for BTC.
In a video update, pseudonymous analyst Rekt Capital tells his 86,100 YouTube subscribers that Bitcoin historically goes through a four-year cycle based on the halving – when BTC miner rewards get slashed in half.
Looking closer, Rekt says Bitcoin had to deal with a “three-year resistance” level in every four-year cycle – dating back to as early as 2013.
According to the analyst, Bitcoin had to breach its three-year resistance at around $700 in 2017 and $13,856 during the 2021 cycle before printing a market top.
For this cycle, Rekt says the three-year resistance level stood at $46,000, which BTC has already taken out.
But the trader notes that Bitcoin may revisit the area to retest it as support before sparking the next leg up.
“If we look at the dynamics of how this transition occurs, candle four tends to set up potential retests of this three-year resistance into new support to propel price to new all-time highs and beyond…
If we focus on candle four and the halving year candle, there is always scope for the retest during the year of that three-year resistance, from resistance into new support… And it looks like there is potential scope for a retest of this level into new support. That would mean that we need to drop into $46,000 for that retest. That would mean that we need to drop 19% this month.”
While the trader thinks that a drop to BTC $46,000 this month is within the realm of possibility, he highlights that it is a low-probability event given that Bitcoin is in a halving year, and not in a bear market.
At time of writing, Bitcoin is trading at $54,197, up slightly on the day.
Don’t Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
Follow us on X, Facebook and Telegram
Generated Image: DALLE3
Read the full article here