Bitcoin Is Reaching Mid-Halving in Upcoming Months, Here’s How Price Bottomed In Previous Cycles

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Arman Shirinyan

Bit­coin’s halv­ing may save mar­ket again, accord­ing to his­tor­i­cal analysis

With the mas­sive cor­rec­tion on the cryp­to mar­ket, more traders and investors are switch­ing from mak­ing short and mid-term pre­dic­tions and are look­ing at macro data like Bit­coin halv­ing cycles and the effect they have on the cryp­to mar­ket.

Investors who use BTC halv­ing as a mar­ket indi­ca­tor ‌often rely on the mid-halv­ing, which some­times becomes a bot­tom for the price of the dig­i­tal gold. In the pre­vi­ous cycle, we saw a mid-term bounce off of the log­a­rith­mic sup­port curve, which sup­pos­ed­ly cor­re­lates with the 780th-880th day of the halv­ing cycle.

Bitcoin Halving
Source: Trad­ingView

The analy­sis based on Bit­coin’s halv­ing mod­el has its roots in the sim­ple law of sup­ply and demand. The size of the block reward is a tool that can affect Bit­coin’s total sup­ply infla­tion direct­ly as min­ers pro­vide con­stant pres­sure on the market.

In two pre­vi­ous halv­ing cycles, Bit­coin suc­cess­ful­ly bot­tomed out around the afore­men­tioned day range, which is even more notable on the log­a­rith­mic chart.

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Halving continues to affect market

Dur­ing the bull­run of 2021, many ana­lysts, includ­ing Willy Woo, believed that halv­ing would no longer have such an impres­sive effect on the mar­ket as we saw before. His main rea­son­ing was insti­tu­tion­al expo­sure on the cryp­tocur­ren­cy mar­ket, which is going to tie it more to stocks and make it less independent.

We are yet to see the actu­al source of the pres­sure on the cryp­tocur­ren­cy mar­ket since Bit­coin is cur­rent­ly mov­ing in cor­re­la­tion with the stock mar­ket, which had been plung­ing after unex­pect­ed infla­tion data and the Fed’s hawkishness.

In addi­tion to macro­eco­nom­ic pres­sure on the mar­ket, prob­lems with Ethereum-based DeFi ser­vices and plat­forms are caus­ing addi­tion­al pan­ic on the market.

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