The cryptocurrency market is on the brink of a new era, with high hopes pinned on the upcoming 2024 halving event, which is just four months away. This event has historically triggered major price surges, and it’s not the only reason for investor excitement. Developments ranging from ETF approvals to potential Federal Reserve interest rate cuts are expected to further stimulate the market.
Rekt Capital, a renowned crypto analyst known for accurately identifying market bottoms and peaks, has recently shared insights about the halving on social media. These details are crucial for investors, who must remain vigilant in the coming months.
The analyst focuses on the pre-halving period, as the 2024 halving in April is imminent. Historically, deeper retracements during this time have led to significant gains post-halving. Speculation surrounding a Bitcoin ETF could be a factor, suggesting a possible deeper pullback within the next two months. This period is critical, as any retracement could represent a final bargain buying opportunity for Bitcoin.
Currently, Bitcoin is struggling to reclaim the $43,000 level, while most altcoins have started the new year in the green. The next phase may see a pre-halving rally about 60 days before the event, driven by short-term traders and speculators buying into the hype. However, these gains are often sold off just before the halving, contributing to a pre-halving retracement.
Investors should be prepared for this potential “sell the news” scenario. Historical data shows that pre-halving retracements can be significant, with a 38% pullback in 2016 and a 20% pullback in 2020. These retracements can last several weeks and may cause investors to question whether the halving will act as a bullish catalyst for prices.
The analyst also describes the fourth and fifth stages: a period of reaccumulation follows the pre-halving retracement, often marked by investor frustration and impatience. The final stage is the onset of a parabolic uptrend, where Bitcoin experiences accelerated growth towards reaching new all-time highs.