Analysts of the crypto market have posted another good news for the bulls. It has recently been pointed out that the third Bitcoin halving is set for May 2020. Historically, BTC is known to print major upward rallies around six months before the halving event is due. With the start of the new month (November), therefore, crypto experts are anticipating the next hike in Bitcoin that is likely to break above the last week’s high of $10,400. In extension, analysts have added, it could also continue to surge and challenge the yearly high of around $13,380.
Bitcoin May Drop To $8,820 In The Next 24 Hours
In the short term, Bitcoin has just broken a contracting triangle as evident from the hourly chart that potentially hints at a probable decline to $8,820 within the next twenty-four hours. On the other hand, if the world-renowned cryptocurrency catches steam to rise above $9,300 level again, that marks a crucial resistance as per the hourly chart, the bearish inclination will stand invalidated.
Technical analysts have remarked that the upward rally to the previous high of $10,400 is likely to be hindered by an intermediate resistance currently located at around $9,600, as highlighted by the 100-day average.
Bitcoin halving can be thought of as the process that cuts the BTC’s supply by 50%. As of now, mining a single block gives 12.5 Bitcoins to the miner. Following halving in May 2020, miners will only get 6.25 Bitcoins for each block that they mine. In simpler words, the number of Bitcoins generated every ten minutes will drop by 50%.
Bitcoin’s Historical Pattern Ahead Of Halving
Historically, back in 2012, when the reward for mining a block was reduced from 50 Bitcoins to 25 Bitcoins, BTC had posted a hike from $5 to $16 ahead of the halving event. Similarly, in 2016, when the reward was further curtailed from 25 to 12.5 BTC per block mined, the price surged from $360 to $780 in the months before halving.
Analysts have construed the historic events as an impending shortage of BTC supply being factored in the price as much as six months in advance. If the pattern continues, therefore, Bitcoin can be expected to make a new high by the end of the year. Elaborating further on the historic patterns, experts have also remarked that in the previous six out of eight years, the months of November and December have marked significant gains for Bitcoin.
At the time of writing, Bitcoin is trading at around $9,300. Bitcoin has been trading sideways for the past couple of days, struggling to break above key resistance at around $9,300 as evident by the key moving averages.