BTCUSD Shy Off Record Highs

Bitcoin is hitting new records against various currencies worldwide just weeks ahead of the widely anticipated halving event. Can the trend also be replicated in dollar terms?

Trend Supported by Institutionals

Last week, bitcoin closed in on its all-time high, moving above $64000 for the first time since the end of 2021 after gaining 20% over just five trading days. Analysts cited strong demand from US-listed Bitcoin ETFs as helping to propel the cryptocurrency higher, which saw an 186% surge over the past year. The ETF listings have contributed billions of dollars into bitcoin, with investors betting on the price overtaking the $69000 record set during the Covid-19 pandemic.

Investors appear to be speculating on strong demand and the limited liquidity of Bitcoin ahead of its halving event, which will halve its supply growth and could exacerbate demand pressures. Previous Bitcoin halvings have been accompanied by periods of bullish sentiment, which may explain the current demand ahead of the event. However, analysts caution that there is no guarantee that the price will rise, given the uncertainties of markets.​

Further Upside or a Downturn?

Not all commentators share the same optimism, in any case. JPMorgan cautions that Bitcoin may drop 33% following next month's halving event. The investment bank said that the cryptocurrency could lose as much as 20% immediately after the halving as less efficient miners exit the network, bringing hashrates back in line with historical trends. The recent price "euphoria" induced by the lead-up to the halving will likely subside in the aftermath of April.

JPMorgan's view appears to be in the minority, with many other analysts projecting a rally to as high as $88000 after the halving. The prevailing analyst opinion is that the halving will be followed by an increase in price, though there is less consensus regarding the scale of upside potential.​ Another cited factor that upward pressure may persist includes expectations that the Fed will cut interest rates, which could reduce borrowing costs and support the markets through the end of the year.​

BTC at Risk of C&H Pattern

Bitcoin is trading approximately 6% below its all-time high, with the recent strong upswing raising the possibility of a double top near $69000. Should the price move above the record level, the $70000 mark may trigger new selling pressure, potentially leading to a cup-and-handle following a brief fakeout. This would bring $49000 back in focus, potentially exposing $38,500. However, bulls will likely target the $75000 region if the breakout is strong.

Source: SpreadEx / Bitcoin

Key Takeaways

Bitcoin hit new records against other currencies ahead of its upcoming halving event, though it has yet to replicate this in dollar terms. While many analysts project further gains after the halving reduces supply, others caution about potential downside risks. Strong institutional demand from US-listed Bitcoin ETFs has helped propel prices higher; however, not all are optimistic. JPMorgan warns of a possible 33% drop post-halving as less efficient miners will exit. Most agree the halving will impact prices, but opinions diverge on the scale of upside or downside.