Bitcoin (BTC) has exhibited remarkable strength in recent months, disregarding challenges such as a resurging U.S. dollar and rising Treasury yields. 10X Research suggests that while a price correction may be on the horizon, the broader upward trend is poised to continue, potentially leading to Bitcoin revisiting and surpassing its all-time high of $69,000 before the fourth mining reward halving scheduled for April 19.
Pre-halving Bullishness:
The well-established theory that Bitcoin tends to bottom out 12-16 months prior to its halving event, followed by uptrends leading up to and a year after the halving, is a key factor in the optimistic outlook. Examining past cycles, the data indicates that Bitcoin’s price typically surges by over 30% in the eight weeks preceding the halving, a significant event that halves the per-block reward, this time reducing it to 3.25 BTC from 6.5 BTC.
Markus Thielen, the founder of 10X Research, emphasizes that Bitcoin historically rallies around 32% in the 60 days leading up to the halving. With Bitcoin currently trading around $52,000, this historical trend suggests a potential rally that could bring prices close to or even surpass the record high of $69,000 by the time of the halving on April 19.
Monthly RSI Signals:
The Relative Strength Index (RSI), a momentum indicator measuring the speed and change of price movements, has shown notable signals. Bitcoin’s 14-day RSI recently crossed above 80, indicating strong upward momentum. According to 10X Research, in 12 out of 14 instances when such RSI signals occurred in the past, it preceded accelerated uptrends, resulting in an average gain of 54% in the following 60 days.
For instance, the last time the RSI signal was triggered, Bitcoin was trading at $48,294, and based on historical patterns, a potential rally to $74,600 is suggested. However, it’s essential to note that past performance does not guarantee future results, and external macroeconomic factors could influence market trends.
Despite potential headwinds, the prevailing bullish sentiment, supported by historical data and technical indicators, suggests a positive outlook for Bitcoin’s price trajectory leading up to the mining reward halving. Investors are closely monitoring these signals as they navigate the evolving cryptocurrency landscape.
