Again, after a bullish move of over 5% to 6%, the Bitcoin price has consolidated within a narrow range. While the bears fail to squeeze profits, the bulls are not above achieving levels above $42,000. However, the recent upswing has raised the market capitalization above $1.6 trillion, which has sent bullish waves across the space. Now that the bitcoin halving is fast approaching, the pre-halving correction history suggests one more bearish move could be on the horizon.
Observing the previous recovery year and the pre-halving correction that happened in 2019 and 2020, the BTC price produced a relief rally that lasted for 5 months in green. Later, the rally entered a corrective phase, which hit its climax in March 2020. The bottom-month signal came in after exactly 427 days, following which a strong bullish wave ended the long distribution phase. The present relief rally in 2023 printed 4 green months, followed by the first red month exactly at 426 days.
Now that the BTC price has reached the bottom of the signal month, the historical price history suggests a major drop could occur in the coming month.
Considering the previous price action that occurred in the past, it suggests the price is due for an extended bearish trend that may get extended below $30,000. However, the price is likely to recover the same month and then produce a long-term bull rally in preparation for a major bull run. With this, the crux of the matter remains whether the ATH could be reached in 2025 with the price target at $180K, $200K, or more.
Many believe that the Bitcoin price may not produce a strong correction during the pre-halving period similar to 2020, as COVID was the major reason then. It’s worth noting that the price underwent a major correction in 2018, in 2011, and also in 2021–22. Therefore, this suggests the corrections happen unannounced, as the market could make up the matching event. Therefore, it is advisable to trade with extreme caution, as the market trend may flip at any moment and trigger a major divergence.