BTC has been trapped in a bullish flag that might result in a $100K target in the near future if a breakout and close is witnessed.
BTC price has gained over 5.48% in the last 1 month.
Key on-chain metrics, fundamentals and favorable technicals show a bullish momentum and with a bullish breakout potent soon.
This king Crypto is on the verge of breaking out of a bullish flag pattern and kick-starting a massive bull run to over $100K. This breakout might result in a 51% price surge in the near future, a target similar to the prior bullish flag pole height (to approximately 102K.)
However, this is possible only if the BTC Price breaks out and closes above the flag resistance at around $68K.
As of writing, according to latest data in Coinmarketcap, BTC price has recorded a slight increase of 0.29% in the last 24 hours, a drop of 0.17% on the last 7 days and a 5% gain in the last month to read at $67,148.
Source: TradingView
Looking back at the start of the year when BTC recorded a low of $38K in late January, BTC surged to record approximately 92% gain in less than 2 months to hit a new all time high of $73,835. If the same trend is to be witnessed after breakout of the current bullish flag pattern, technical analysis suggests BTC price could hit over $100K mark.
Is a breakout possible?
According to a number of metrics, a breakout is more likely. Santiment data shows that the BTC supply on exchanges has dropped strongly, indicating buying pressure. This supply reduction is a positive indicator because it means market participants are moving their BTC to private wallets anticipating for a future price increase.
Looking further at the total supply of BTC held by whales from Santiment, there has been a steady increase overtime. This means that more whales are taking long positions and this could precede a major uptrend.
Source: Santiment
In the weekly chart analysis, more insights on BTC’s breakout are present. BTC has continued to prove a breakout is more likely using its technical indicators. The Chaikin Money Flow (CMF) shows a clear uptrend deviating from the neutral mark.
BTC has recently retested the CMF ascending trendline that has been rejected several times in the past. Looking at the moving averages, the 50,100 and 200 moving averages are all below the current market price, backing up the buying spree.
Recently, the 50 Moving average and the bullish flag acted as a confluence to support BTC from further declines. This positive indication suggests a net inflow of BTC reflecting strong buying interests.
BTC Weekly Chart: TradingView
Looking further, we get more bullish chances for BTC from the BTC Halving.
What is Bitcoin Halving?
The Bitcoin (BTC) halving is a unique event that occurs every four years which cuts the reward of miners adding a block in the blockchain by half (50%). This event is particularly important due to the fact that Bitcoin will only have a capped total of 21 million coins. During the time of the halving, the rate at which new BTC enters the market is decreased, making it relatively more rare to find new BTC.
As supply is restrained and demand typically remains the same or increases, it exerts a bullish impact on prices. In the past, BTC halving has been considered a trigger event that has been succeeded by price rallies within months and even years as the supply of new coins is expected to be cut substantially.
The history of how Bitcoin's price reacts to the previous halvings can be described as follows: The price doesn't peak directly after the event, but a few months before it usually does so and this is especially emphasized by the popularity of the asset. In this case, the term 'market becomes volatile' also includes the time that proceeds and follows the actual event.
Not to be forgotten here are other external factors such as general mood of the market, economic situation and regulatory changes. Each of the previous halvings (2012, 2016, 2020) did not fail to bring onstage a bull market. Every time there has been an expectation of a new record.
Currently, we are in the consolidation phase before the next potential explosive move in this current remaining quarter of the year or the first quarter of 2025.
Will history repeat itself?
As seen, BTC consolidated for 170 days before a breakout in 2016, 168 days before a breakout in 2020 and we are currently at exactly 188 days after halving. If history repeats this time, this is a time for $BTC to witness a major and a big breakout.
Looking further at the FED, the longed-for moment happened recently. For two and a half years ever since America’s FED embarked on its fastest series of interest-rate rises since the 1980s, investors were desperate for any hint of when it would reverse course.
Impact of Interest Rates on Bitcoin Price Rally
The dependence of rates in relation to the price of bitcoin can be traced to the traditional financial markets. When the Federal Reserve, for example, cuts the rates of interest, it makes it easy to obtain loans, and this higher return may be sought in the form of bitcoins.
Low-interest rates also decrease the opportunity cost of holding yielding assets such as bonds or savings accounts. Borrowing costs may be low and make investors to seek for alternative currencies, Aforementioned factors quite often result in a greater demand for bitcoin, thus pushing prices to peak levels.
On September 18, the Fed cut interest rates by 0.50%. When this happens, you get a massive bull run in Gold, Stocks, Bitcoin and altcoins. This comes as a result of increased liquidity, a weaker dollar, and a shift in investor sentiment towards alternative assets. The last time the Fed cut rates, Bitcoin went parabolic. If history repeats itself for this also, the next 6-12 months are going to be insane.
Source: MacroMicro
Role of U.S. Elections in Dictating the Price Movement of Bitcoin
Zooming out, the U.S. elections are scheduled for Tuesday, 5th November 2024. This is also a crucial factor that might see BTC hit $100K sooner than expected. Bitcoin always seems to rise massively after U.S. elections, regardless of whether there is a Democrat or Republican in office.
Source: MilkRoadDaily
The market doesn't like uncertainty, and U.S. election season is the height of uncertainty. Historically, BTC prices has rallied for roughly 1 year after each election.
Elections in the US create a lot of uncertainty and turmoil in not just the stock markets but also indices with respect to policies, regulations and allocation of fiscal spending. Much like any other event, the upcoming elections result in the fluctuations of the stock market because the participants in the market expect certain policy developments affecting certain industries such as technology, energy or finance.
During such heightened volatility conditions, investors start looking for assets that will protect them from swings in the markets. In such cases the assets that investors consider good strong stores of value have always been gold, dollar and yen.
For the last couple of years, these assets have been cryptocurrencies like Bitcoin. Many have turned to looking for those with better technology and inflation-resistant features.
U.S. elections tend to provide Bitcoin with an inflow as people treat it as storage. When political tensions rise during the November elections, clients prefer to transfer their funds into Bitcoin believing it to be a safe asset.
Furthermore, since Bitcoin is not a currency that is directly issued and controlled by any state's officials, investors who are worried about legislative changes or shifts in monetary policies immediately after the elections find it attractive.
Displacement of funds in this way can increase the demand for Bitcoin, thereby causing major price spikes during and following election periods.
BTC Price Prediction
Conclusion
To wrap things up, it can be concluded that Bitcoin is preparing for a breakout from its consolidation, as evidenced by important technical indicators, whale activity and low exchange supply. The next upsurge is likely to be triggered by the US elections, Bitcoin halving and further macroeconomic improvements like interest rate cuts. Therefore, BTC will likely be above $100K.
It has been observed that periods after elections and after rounds of halving have always been followed by periods of price eruptions. With strong fundamentals supporting Bitcoin's market position, a move of this magnitude makes 51% sense if BTC breaks through the much anticipated $68K level.
Judging from the pattern of increasing institutional adoption and that of supply as a function of scarcity with time, the target time frame of price for Bitcoin tokens will soar to high targeting levels.
