However, some may wonder: why does this round of the bull market not exhibit the astonishing surge seen in the previous round?
In fact, the key lies in the differing pace of liquidity release in this round compared to previous ones. Looking back at 2020, to effectively respond to the significant impact of the pandemic, the Federal Reserve drastically cut interest rates by 150 basis points within a month. Meanwhile, many countries around the world followed suit rapidly. Such a swift and forceful liquidity operation instantly ignited the passionate fire in the Bitcoin market. In just six months, Bitcoin's price soared dramatically, reaching a historical high of $65,000, with an astonishing increase of 20 times.
However, after this, due to the abrupt halt of liquidity, Bitcoin's price only slightly climbed to $69,000 by the end of the year, essentially comparable to the high in April.
Focusing on this cycle, there have been significant changes. This round adopts a strategy of slow liquidity release, with market expectations of a 200 basis point interest rate cut within the next six months, which is completely different from the rapid rate cuts of 2020. Because of this, this round of the bull market resembles the 2017 bull market more closely, showing a trend of steady and continuous upward movement, whereas the 2017 bull market lasted a full year and a half.
Looking back at the period from March to September this year, the cryptocurrency market seemed calm and without movement. The root cause lies in the fact that the Federal Reserve had not yet initiated interest rate cuts, and the market was like a parched land, lacking a continuous influx of incremental funds, which led to the overall market being stuck in a sideways state for some time.
However, the major global economies, such as the United States, China, and Europe, are gradually moving towards quantitative easing, with Japan being the only exception. Meanwhile, the approval of Bitcoin ETFs has added fuel to this brewing bull market, which is quietly in the works.
For the vast majority of investors, what can be done at this time is to firmly hold onto the coins in hand, maintain sufficient historical patience, and quietly wait for our moment of harvest. It might be bold to envision that next year's market could bring us returns of 3 to 10 times.
From a short-term perspective, if Trump successfully takes office in early November, he is likely to become a powerful catalyst for the market. The cryptocurrency market is currently at a critical juncture, urgently needing a major piece of news to break the existing calm. Against this backdrop, Bitcoin is expected to break through its previous historical high and the price could directly rise by 20%. Moreover, from various signs, it is not far-fetched to believe that by the end of the year, its price could surge to $100,000.
When we switch our perspective to the weekly level to observe Bitcoin's trend, we will find that it still has not been able to break through the long-standing downward channel. Only when Bitcoin successfully breaks through and firmly stands above the key price level of $69,800 can we confidently declare that the downward trend has come to an end, and a new market is about to begin, with the bull market brought by the fourth halving officially entering a fast track of rapid development.
Before the bull market truly 'gallops', and before the liquidity released by the Federal Reserve due to interest rate cuts floods into the market like a tide, the market may very well undergo a deep reshuffling and sustained decline, just like the fiery tempering before the phoenix's rebirth!
As for the specific ways of decline, it may present various forms. First, there will be a continuous downward trend, as if the market is quietly hibernating; then there will be a certain degree of volatility and rebound, like the faint light before dawn; followed by another downward trend, and the market sentiment will also fall into gloom; then there may suddenly be a rapid decline, causing many retail investors to panic and cut losses, and those high-leverage operations will also be forcibly liquidated in this wave of impact. After all this ends, the market will be like a well-rested steed, ready to charge forward, and the bull market will take off with this momentum.
