Analyst Says Bitcoin to Enter Danger Zone Soon After 11% Drawdown to $66k

An analyst explains that Bitcoin will likely see more downtrend as it enters the pre-halving “Danger Zone” in four days.

Amid Bitcoin’s sharp decline within the past few hours, an analyst has projected the next four days as the starting point of a “Danger Zone” where BTC is expected to see a significant price decline as it braces for the upcoming halving event.

#BTC

In 4 days, Bitcoin will officially enter the “Danger Zone” (orange) where historical Pre-Halving Retraces have begun

Historically, Bitcoin has performed Pre-Halving Retraces 14-28 days before the Halving

In 2020, this retrace was -20% deep

In 2016, this retrace was… pic.twitter.com/8wv6PEuqdb

— Rekt Capital (@rektcapital) March 15, 2024

Bitcoin Halving to Trigger More BTC Downtrend

Bitcoin halving is a mechanism used to combat the inflation of the leading cryptocurrency. It is achieved by downsizing the number of mined BTC for each block by half. The event occurs every four years. So far, a halving event has occurred in 2012, 2016, and 2020. The block reward has been reduced from 50 BTC to 6.25 BTC during this time.

The analyst’s latest study springs from past pre-halving price movements. In 2016, BTC’s price saw a significant price drop by about 40% days before the halving occurred. A similar trend occurred in 2020 as the crypto asset’s value plunged by 20% when the halving event inched closer. These historic events brought the analyst to the conclusion that BTC’s price typically retraces itself 14 to 28 days before the halving event.

The next halving event will occur next month, which is over 30 days away. The number of BTC produced is expected to drop from 6.25 BTC to 3.125 BTC. Following the analyst’s research, BTC holders can expect the lauded cryptocurrency to see a price dip within the next few days.

BTC Dips 11% This Week

Bitcoin’s recent price movement brings the analyst’s study closer to reality. After seeing an all-time high of over $73,800 earlier this week, the cryptocurrency has seen a sharp decline to around $66,000. The downturn represents more than an 11% decrease.

At press time, BTC trades around $68,300, representing a 4.4% drop in the past 24 hours.

Source: CoinStats