June 14, 2024
Bitcoin


Cryptocurrency analyst Rekt Capital has come up with an intriguing narrative pointing to several trends in the current price action of Bitcoin that are similar to the price trends seen in the 2016 bull cycle, even as market sentiments continue to dwindle. 

Bitcoin Trends Reiterating 2016 Pattern

According to Rekt Capital, more than a month after the initial analysis, Bitcoin keeps demonstrating how much it closely resembles the cycle of 2016. Similar to 2016, Bitcoin has experienced further declines over the past three weeks following the Halving below the Range Low of its Re-Accumulation Range also known as the Post-Halving Danger Zone

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Over a month later Bitcoin continues to prove how it is more similar to the 2016 cycle. Just like in 2016, Bitcoin in this cycle is seeing additional downside below the Range Low of its Re-Accumulation Range in the three-week window after the Halving (i.e. Post-Halving “Danger Zone”).

Given that Rekt Capital already addressed the concept of the Post-Halving Danger Zone, the analyst is not shocked by this current price decrease. During the 2016 cycle, about 21 days after the Halving event, BTC saw a lengthy decline of 11% before transitioning toward an upward direction.

Bitcoin
BTC mirroring 2016 pattern | Source: Rekt Capital on X

It is worth noting that Rekt Capital noted that if downside volatility around the Re-Accumulation Range Low is going to happen in this cycle, 2016 history indicates it may happen during the 15 days following the Halving. Since the recent event was concluded about 12 days ago, the expert’s prediction could be realized in the upcoming days.

Related Reading: Bitcoin Enters ‘Danger Zone’ Post-Halving, Analyst Warns Of Potential Downside

While the Post-Halving “Danger Zone” ends in 15 days, 2016 data suggests that there may be some negative volatility in the interim, possibly reaching the $60600 Range Low.

Drawing attention to previous patterns, Rekt Capital highlighted a similar pattern between the 2016 and 2024 pre-Halving re-accumulation range. After a breakout from the re-accumulation range this year, BTC witnessed a Pre-Halving rally, as was observed in 2016.

Pre-Halving Retrace Movement

Just like in 2016, once the pre-Halving rally peaked, Bitcoin started its Pre-Halving retrace. Specifically, this occurred roughly 28 days prior to the Halving event in both 2016 and 2024.

A negative wick on the weekly candle indicates a significant reaction in the first week of the pre-Halving Retrace in 2016. However, this reaction was fleeting and came before an extended price decline.

This cycle likewise saw a strong early reaction from Bitcoin via a downward wick, but there are indications that this reaction might not have lasted long. Thus, to avoid a fate similar to that of 2016, Rekt Capital believes that BTC will need to maintain highs around $60,000 and beyond.

Bitcoin
BTC trading at $58,804 on the 1D chart | Source: BTCUSDT on Tradingview.com

Featured image from iStock, chart from Tradingview.com

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