The year 2022 was a very tough year for all cryptocurrencies, most especially Bitcoin. Bitcoin has lost nearly 65% of its market value in the entire year of 2022.
A series of unfortunate events such as the Terra Luna crash, the fallout of the largest crypto exchange FTX, and the looming macroeconomic conditions caught crypto enthusiasts off guard.
But several questions are hovering in the mind of crypto traders: what will happen next? Will Bitcoin ever rise again? Or, will it crash just like in 2022?
Presently bitcoin’s bullish recovery in 2023 was witnessed last week by institutional buying pressure, casting doubt if BTC will rally beyond $25,000.
Bitcoin Bullish View
Bitcoin has shown the potential of stretching its ongoing price recovery to $25,000 by March, based on a mix of bullish technical indicators.
Presently, Bitcoin is currently trading within the levels of $20,500 and $21,200 with a positive change in its price since last week. At the time of the writing, the daily trading volume of bitcoin stands over $21 billion.
Experts believe that once Bitcoin crosses the crucial resistance level of $21,500 then it might aim to move upward toward another resistance level of $25,000 opening the doors for more bull runs
Bitcoin can potentially hit $25,000 from its exit from a prevailing descending channel range.
Technical indicators
Notably, BTC’s price broke out of the range late last week, accompanying a rise in its trading volumes. The cryptocurrency’s move upside also pushed the price above its resistance confluence, comprising a psychological price ceiling of $20,000 and its 20-week exponential moving average (200-week EMA; the yellow wave) near $20,900.
The price again picked up the pace and continued showing bullish signals until now. Let’s have a look at what picture technical indicators are depicting as of now:
Breaking three resistance levels with substantial volumes shows traders’ conviction about an extended price rally. Should it happen, Bitcoin’s next upside target appears at its 200-week EMA (the yellow wave) at around $25,000 — a 20% rise from current price levels.
- Hourly Moving Average Convergence/Divergence (MACD) – Gaining pace in the bullish zone.
- Hourly RSI (Relative Strength Index) for BTC/USD – Above the 50 levels.
- Support Levels – $16,000
- Resistance Levels – $21,500, $25,000.
One of the reasons why experts are bullish on Bitcoin is that next year, 2024, is a year for Bitcoin’s halving event. The Bitcoin halving event happens every four years in which Bitcoin rewards to its miners are cut in half, (the miner’s payout will be reduced to 3.125 BTC).
This event is generally viewed as positive for Bitcoin’s price, as halving helps in contracting supply. Historically, halving has been seen as a very good sign for bringing momentum to Bitcoin’s price.
Bitcoin Halving Event
Bitcoin halving is the term used to identify the block reward subsidy schedule. According to the Bitcoin blockchain protocol, the Bitcoin block reward is cut in half every 210,000.
Given the Bitcoin block reward is cut in half from 50 to 25, to 12.5, to 6.25 and so on, this process and schedule are called the Bitcoin block reward halving.
A Bitcoin halving is scheduled to take place every 210,000 blocks. Three Bitcoin halvings have already taken place, one in 2012, 2016, and the last halving in 2020.
The Bitcoin halving prediction is based on the latest block height of 772,790 and the average block time for the last one thousand blocks, which is currently at 563 seconds per block.
The next Bitcoin halving is scheduled to take place at block 840,000 which is predicted to be on Apr 02, 2024, 12:59:50 AM UTC.
At the Bitcoin halving 2024, the Bitcoin block reward is scheduled to drop from 6.25 Bitcoin per block to 3.125 Bitcoin per block.
Last Bitcoin Halving
The last Bitcoin halving occurred in 2020 at block 630,000 on May 11, 2020, 7:23:43 PM UTC. At that time the Bitcoin block reward dropped from 12.5 BTC and cut in half to 6.25 BTC.
The Bitcoin halving 2020 happen at block 630,000 on May 11, 2020, 7:23:43 PM UTC.
At the time of the Bitcoin halving the block reward will be cut in half and therefore every Bitcoin mining operation (large and small) will have its revenue also cut in half.
This period is very hard for miners and in turn, some miners will have no choice but to turn off their mining hardware or look for more profitable cryptocurrencies to mine.
You can use the Bitcoin mining calculator to estimate your mining rewards when the block reward is cut in half.
Bitcoin Halving History
So, if we closely observe the data, past Bitcoin halving
events have been able to establish long-term bullish
drivers for Bitcoin’s price.
The Bitcoin halving event directly relates to its
deflationary tendency and squeezes its supply, which
helps the BTC price to rise further. Bitcoin is a
decentralized cryptocurrency, cannot be printed by
governments or any central banks, and thus the total
supply of Bitcoin is limited.
The other reason for Bitcoin to rally in 2023 is the U.S.
Fed’s interest rate negotiations, which might help
Bitcoin to maintain its rising trajectory and outperform
as compared to other asset classes.
Moreover, large investors which are known as “Bitcoin
Whales”, have started accumulating BTC once again.
According to data from on-chain aggregator Santiment,
the large Bitcoin whales are holding between
1,000-10,000 BTC in their wallets, indicating that
investors have been filling up their wallets with a lot of
BTC, which might show the recovery sign in the price of Bitcoin
Conclusion
If the bitcoin price can’t break through the resistance region of the $21,500 barrier, the entire crypto market will slowly fall, and most investors will firmly believe their prediction was right about the rally being a bull trap.
However, experts believe that once Bitcoin crosses the crucial resistance level of $21,500 then it might aim to move upward toward the resistance level of $25,000 opening the doors for more bull runs.
