Bitcoin may peak according to the halving cycle in October 2024, 550 days after this halving event.
Many investors are currently ignoring signals from the traditional halving cycle, shifting towards new indicators like the correlation between Bitcoin and global M2 money supply, but this is assessed as unsustainable emotional behavior.
MAIN CONTENT
The Bitcoin halving cycle still plays an important role in predicting market peaks.
Many investors are currently chasing new indicators, downplaying the traditional halving cycle.
The increased participation of institutional investors may make the halving cycle less accurate.
What is Bitcoin halving and why does it affect the market?
The halving cycle is a periodic event that reduces the Bitcoin mining reward by half, significantly impacting supply and prices. Rekt Capital, a cryptocurrency analyst with over 5 years of experience, emphasizes that halving drives long-term market breakthroughs based on historical data.
Analysis from various reports indicates that each halving creates temporary scarcity, followed by a price increase trend lasting several hundred days into the next year.
How do experts view the Bitcoin halving cycle according to Rekt Capital?
Rekt Capital forecasts that the current bull cycle could peak in October 2024, which is 550 days after the halving in April 2024. He also warns that many investors are currently overlooking the role of halving, leading to decisions based on fear and emotions rather than mainstream data.
“Many investors currently overlook the halving cycle to chase new ‘stories’ such as the relationship between Bitcoin and global M2 money supply. This behavior is emotional and does not accurately reflect market fundamentals.”
Rekt Capital, Cryptocurrency Analyst, July 2024
Why do some analysts believe that the halving cycle is less reliable now?
In stark contrast to previous cycles, the strong participation of investment institutions in Bitcoin has changed the traditional market pattern. Many experts believe that the halving cycle no longer accurately reflects price dynamics as institutions have long-term investment strategies and structured risk management.
A report from the Blockchain Research Institute in 2023 shows that the Bitcoin holding ratio of institutional funds reached 25% of the total supply, much higher than previous cycles.
What are the consequences of ignoring the halving cycle in investment direction?
Ignoring halving cycle signals and shifting to new indicators may lead investors to easily fall into FOMO or FUD traps due to the highly volatile cryptocurrency market. This means higher risks and more opportunities for mispredicting prolonged trends.
“Understanding and adhering to the halving cycle helps investors make more informed decisions, minimizing the impact of emotional volatility in the cryptocurrency market.”
Nguyễn Hùng, CEO of Blockchain Consulting Company, 2024
Compare the main characteristics of the traditional halving cycle and current trends
Criteria Traditional Halving Cycle Current Trend Price Peak Timing 550 days after halving Potentially extending to 2026 Main Impact Reduces supply, creates upward price pressure Influenced by institutional investment growth Indicators Focused Halving cycle, price history New indicators like correlation with M2 money supply Reliability Very high based on historical data Lower due to organizational factors and new analysis
Frequently Asked Questions
How long does the Bitcoin halving cycle last? The average halving cycle lasts about 4 years, during which the price peak can occur approximately 550 days after the halving. Why do many investors ignore the halving signal? They chase new indicators and narratives like the correlation with the global M2 money supply, leading to emotional investment behavior. How does the participation of institutional investors affect the halving cycle? The increase in institutional investors alters market patterns, making the halving cycle potentially less accurate than before. How can investors effectively take advantage of the halving cycle? It is important to understand the history of the cycles, combine it with technical and fundamental analysis, and avoid chasing emotional indicators or rumors. What new indicators are investors paying attention to besides the halving cycle? The correlation between Bitcoin price and global M2 money supply is an indicator that many are monitoring.
Source: https://tintucbitcoin.com/chuyen-gia-bitcoin-sap-ngung-tang-gia/
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