Despite Bitcoin briefly falling below the $60,000 mark, the cycle could be entering a reaccumulation period, according to one crypto analyst.
Bitcoin price briefly fell below $60,000 only a few days before the much-anticipated Bitcoin halving. Yet, many traders remain optimistic about Bitcoin’s long-term price outlook based on historical chart patterns and institutional inflows.
Bitcoin remains in pre-halving “danger zone”
Despite the recent price correction, Bitcoin reclaimed a key moving average indicator, which signaled the start of the bull runs during previous market cycles, according to popular crypto analyst Moustache, who wrote in an April 16 X post:
“Many people are expecting much lower prices, but I’m not… BTC reclaimed the [blue] line last month, now backest. When this happened in 2012, 2016 and 2020, Bitcoin was just getting started.”
Bitcoin has been in the pre-halving “danger zone” for a month since March 14, according to popular crypto analyst Rekt Capital, who wrote in an April 17 X post:
“It has been a month that Bitcoin has been in the ‘Danger Zone’ (orange). In that time, Bitcoin has retraced twice -18% in March and now almost -16% thus far.”
The pseudonymous analyst added that Bitcoin could already be entering a reaccumulation phase, in an April 17 video posted on X:
“We’ve seen the pre-halving retrace take place because -17% downside has occurred already, so maybe we’re slowly transitioning to the re-accumulation period.
Following the Bitcoin correction, key technical indicators have been reset, suggesting that Bitcoin is no longer overbought now that it fell on the daily chart to 41, down from 58 on April 8.
Bitcoin price has falle over 7% during the past week. The main reason behind the drawdown could be the recent geopolitical tensions between Iran and Israel, according to John Patrick Mullin, CEO and founder of Mantra, who told Cointelegraph:
“A major event took place this week with Iran and Israel. Crypto markets are more fast-moving than any on the planet, hence events like this reflect almost instantly, which is what we’ve seen. What I will say though, is that a bounce back was seen right after, which is very optimistic long term.”
The current drawdown is considered a healthy correction, as the outlook for the next 18 months remains bullish, according to Mullin:
“Another angle to consider is that historically, miners sell BTC around halving, so short term it could be bearish. But these are healthy corrections, as BTC has been bullish consistently for quite a while, so anything offsetting euphoria is good long term.”
Bitcoin ETF inflows will drive post-halving rally
Bitcoin traders also remain optimistic thanks to the continued inflows from the 10 spot Bitcoin exchange-traded funds (ETFs) in the United States and the recent approval of spot Bitcoin ETFs in Hong Kong, which are set to launch for trading over the next two weeks.
The Bitcoin ETFs have seen over $12.5 billion in net inflows since launch, amassing over 838,000 BTC, worth $53.7 billion in total holdings, according to Dune.
While the post-halving period is usually followed by short-term price stagnation, this cycle could be different due to the approval of Bitcoin ETFs, according to Ivo Georgiev, CEO of Ambire. He told Cointelegraph:
“[This halving] is different because BTC received institutional approval in the form of an ETF, so there’s a lot more retail and institutions watching this one. It doesn’t happen completely in the background as it did before. It isn’t just a party for crypto natives.”
The listing of the first batch of Bitcoin ETFs in Hong Kong will also contribute to Bitcoin’s price rally, according to Mantra’s CEO, Mullin, who said:
“More and more ETFs announced globally means an inflow of ‘fresh’ funds that weren’t in crypto before, so this is a factor I still see as underrated by most analysts in terms of the scale of the funds coming in. It’s not just BlackRock and Grayscale and Hong Kong, but many more will come, in size crypto hasn’t seen before.”
Source: Cointelegraph.com
