Bitcoin in the 10k range again, but will it hold post-halving?

We are just 3 days away from the most talked-about event this year – the Bitcoin Halving.

It will occur at block 630 000 which is estimated to happen on 11 or 12 May 2020 (depending on the timezone you are in) and it’s one of those momentum events that create a lot of buzz. I remember the last halving back in 2016 when the trading volume increased like crazy in the run up to the event and majority of that was happening in China. A week before the event however, the volume dropped and with it, the price too and many people were at sea as to why the price would drop before the event instead of after. Well, the experienced traders are always prepared for such market moves and use such events to catch a top and dump while the rest of the public is euphoric.

Is this going to happen this time around? It’s hard to tell, so far, it seems that the market reacts in a slightly different fashion. The price is currently rallying toward the 10 000 range – a resistance level that proves hard to conquer. Last time we managed to break from that resistance was in June 2019 and then we almost went to 14 000 but dropped soon after and haven’t been able to go up there since. We tried again in February this year, but failed to break from the 10400 level and dropped again. This time, we also had the Covid-19 pandemic to blame too, but thanks to the halving hype we are seeing a quick recovery. However, I see a few factors that point toward a possible drop soon after the halving date. It is very possible that we keep the momentum until then but an overbought RSI and declining volume are just two of the indicators I see as possible signals for the coming correction.

And a correction is to be expected indeed.

Bitcoin has been on the upside for 7 consecutive weeks already and it’s in its 8th right now, which is also the most it’s ever achieved. Back in May 2017 was the only time in its history that we had 8 green weekly candles, so I think that it’s very unlikely that we break this record. I could be wrong, but it makes perfect sense to have a healthy 20% correction after such a wild rally and go down to test the support in the 8k price range one more time before another super-rally takes us to the 15k and above.

There could be other factors that play a role in the coming weeks – the US stock market has been correlated to Bitcoin for the past few months and if it were to turn bearish once again, it will surely affect Bitcoin’s price action as well.

I see a lot of euphoria right now and too many fellow traders and bloggers are calling for $13k Bitcoin in the run up to the halving, many are rejecting the idea that a correction is due and they could be right, but I still don’t buy into that projection. It makes more sense to me that we should expect the market to drop in the day of the halving or soon after. It will probably be a short-lived drop, but it will make sense to happen.

In the long run, we can expect Bitcoin to grow in value quite a bit by the end of the year and going into 2021. Typically, a halving event doesn’t bring immediate results and in 2016 it took a good 4 months until we saw a more significant price increase, but it will happen. Don’t forget, we will produce 27000 Bitcoin less each month from now on and this must account for something.

Fun Facts:

• From 2012 to 2016 we were producing approx. 109,375.00 btc per month.

• From 2016 up to now we were producing approx. 54,687 btc per month.

• From next week we will be producing approx. 27,343.75 btc each month.

In the first 4 years of Bitcoin production we mined 50% of all of the supply, the following 4 year period produced another 25%, totalling to 75% and in the last four years we mined another 12.5%, meaning we are getting close to 90% of Bitcoin’s total supply being already mined.
It will take us another 4 years to reach almost 94% and the rest will take another hundred years.

If you want to see how the whole mining production plays out in numbers and timeframe, go here and grab a free copy of my complete Bitcoin Halving Guide.

Other posts you might like:

Number of Wallets Holding 1+ Bitcoin Skyrocket amid Crypto Downfall

27,000 less Bitcoin per month mined

Bitcoin Halving 2020: Everything You Need To Know