Historical cycle data indicates that Bitcoin has moved beyond the ‘danger zone’

After a notable 23% decline, one expert suggests that Bitcoin may have recently started a reaccumulation phase, indicating a departure from the post-halving “danger zone.” According to the research released by “Rekt Capital” on May 13, Bitcoin looks to have recovered well from the reaccumulation range’s support levels. It’s important to note that historical data shows the existence of “danger zones” before and following halving events, during which times Bitcoin typically sees declines in value. Bitcoin saw a significant 23% drop from its top in the current market cycle, reaching $56,800 by May 1, which may indicate the bottom of the post-halving danger zone.

The expert went on to say that if $56,000 were not the bottom, the current decline would officially equal the cycle’s longest retracement, which is 63 days. But based on past trends, the analyst estimated that the retreat probably ended 47 days later at $56,000. According to this analysis, Bitcoin is on a bullish trajectory, which indicates a time of reaccumulation and opens the door for more price fluctuations.

Bitcoin’s Cycle: Navigating Resurgence and Uncertainty

According to reporters, Bitcoin has recovered above $63,000, indicating a return to the reaccumulation zone. However, they issue a warning that historical trends may not accurately forecast future fluctuations and that there may be more declines in the time frame that follows the halving. Analysts remain optimistic about the present support levels despite this, pointing out that the sell-side impetus for Bitcoin is decreasing near the $60,000 threshold. They stress how crucial it is that this support holds in case there is a return to $68,000. Raoul Pal, the founder of Global Macro Investor, believes that the summer and fall macro trends will be driven by the global liquidity cycle, with cryptocurrencies performing well, particularly in the latter half of the year, when prices of riskier assets soar, which he refers to as a “banana zone.”

Before markets begin to move again later in 2024, there will probably be a period of sideways trading and accumulation, as former BitMEX CEO Arthur Hayes agreed. Furthermore, he mentioned how the Federal Reserve’s monetary policy may push liquidity into risky assets like cryptocurrencies.