Cycles, everything in this world is built around a cycle.
From day to night.
To life to death.
You can see cycles in plants, animals, the moon, and even the stars.
Everything has a start, a beginning, and then a start once again.
And that includes Bitcoin.
So let’s get super cyclical with it, because it’s time for Chico Crypto!!
Yes, Bitcoin goes in cycles.
From bull to bear, to bear to bull all in the matter of 4 years.
The cycle of Bitcoin is unlike anything else in the financial world.
Because Bitcoin has something no other financial product has…something called the Bitcoin
halving!!
The halving event for Bitcoin takes place about every 4 years, and this is when the
miner reward is slashed in half.
There has been 3 halvings so far, with the first in 2012, taking the reward from 50 BTC
per block, to 25.
In 2016 the reward was slashed to 12.5….and with the most recent one in 2020, the reward
dropped to 6.25 BTC per block.
Obviously this slashing of rewards, shocks the markets, and makes the scarcity of Bitcoin
ever more apparent to the world.
The next one is estimated to happen sometime between early May and late June of 2024, and
according to countdown timers we have just crossed the halfway mark.
Now examining previous cycles in regards to the halvings can tell a lot about what the
Bitcoin is going to do for this second leg towards this next one, which will reduce rewards
to just 3.125 BTC.
So since we are halfway through this cycle is the price where it should be relative to
other cycles?
Well the halfway point for the last cycle took place on June 10th 2018, and the Bitcoin
price was about 6500 on that day.
The peak for this cycle was 20 thousand dollars, which means the retracement was about 67.5
percent from the all time high, halfway through the cycle.
The halfway point for the cycle before this, took place on September 18th 2014, and the
Bitcoin price was about 393 dollars on this day.
The peak for this cycle was about 1163 bucks, which means the retracement was about 66.2
percent from the all time high, halfway through the cycle.
Sooo, how far have we retraced from the all time high, halfway through this cycle?
Well the all time high was around 69,000 dollars.
We recently got to a low of about 27000 This is a retracement from the all time high of
about 61 percent….
Well it looks like Bitcoin is behaving exactly like it has in the previous 2 cycles.
We are right on schedule…and like I always say….the more things change, the more they
stay the same.
Now the question on everyone’s mind, is when will this Bitcoin bottom be and what
price could be hit??
Well in the first cycle, Bitcoin went from the peak price of 32 dollars June 8th 2011,
to a low of 2 dollars November 18th 2011.
This was a short high to low, of just 164 days and the loss was a whopping 94 percent
After the 1st halving and into the next cycle, Bitcoin went from a peak price of $1163 November
25th 2013, to a cycle bottom of 152 dollars on January 15th 2015.
This was a high to low of 417 days and the loss was 87 percent.
After the 2nd halving, Bitcoin went from a peak price of about 20 thousand dollars, December
11th 2017 to the cycle low of 3129 bucks, December 15th 2018.
This was a high to low of 370 days and the loss was of about 84 percent.
So from this data we can make some educated guesses on where this Bitcoin bottom will
be, and what the price will be.
Based on Averages of the top to bottom length, 164 days, 417 days, and 370 days, we get 317
days.
If the peak was 69k, set November 10th 2011…317 days after this would put us at a bottom for
this cycle happening September 23rd 2022.
What about how far the price will fall on or around this date?
Well taking averages from 94, 87, and 84 percent we get a percentage decrease for this cycle
of about 88 percent.
That would mean the price would fall down to about 8000 dollars!!
Although, there is a trend there and averages just won’t work in my opinion.
The percent fall from top to bottom is decreasing with each cycle.
From 94 percent to 87 percent is a decrease of 7 percent.
From 87 to 84 percent is 3 percent.
I think taking the averages of those 2 numbers is a better way to analyze this data.
Which would be 5 percent from the last fall of 84 percent or 79 percent.
That would mean the price this cycle and bitcoin bottom would be about 14,500.
Now, this means the low “wick down” if we zoom in on the chart we can see these previou
cycle lows were only hit for a split second….so I have a feeling we will be at or near 20k,
followed by an extreme wick down near this number, and the price will immediately jump
back up near 20k.
So we have identified we are on track halfway through this cycle, and we have identified
where the price might go during these bearish times, the bear market low.
But now it’s time to switch our gears to bullish and find out the price on the halving
date and then next peak price after this coming up halving, and when exactly that could happen!!
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So what could the Bitcoin price be on the day of this halving, estimated to happen between
May and Late June of 2024.
Well as we can see, the price on the 1st halving was 12 dollars, and about 4 years later when
the 2nd halving happened the price went all the way up to 658.
That’s an increase of 5383 percent.
Now from the 2nd halving of 658, nearly 4 years later, on the day of the third halving
the price hit 8572 dollars.
This was an increase of about 1203 percent.
Now we could take the averages of percentage increase between halvings, but that wouldn’t
give us an accurate number in my opinion, we need to follow the trend that percentage
increases are decreasing with each halving.
From a 5383 percent increase, to a 1203 percent increase between halvings equals a reduction
of about 77 percent.
Although I don’t believe it will be as high from halving to halving as the first cycle
is kind of an anomaly.
So I would put it at about 60 percent.
Now a 60 percent reduction from 1203 percent, would give us a percentage increase for the
next halving, of 500 percent.
A 500 percent increase from the last halving price of 8572 bucks would put us at about
$51,500 dollars.
So we know what the price could be on the day of the halving….but now what is going
to be the peak price after this event, and on what day could it come!
Checking out this chart we can see during the 1st cycle, from when Bitcoin first began
trading on exchanges, July 17th 2010 and it hit the cycle peak, June 8th 2011.
The price went from about 5 cents to 32 dollars.
This took 332 days, or just under 11 months.
The price multiplied by 63900 percent
In the next cycle, where the 1st halving took place on November 28th 2012, the price went
from 12 dollars to a whopping $1,163 bucks which took place November 25th 2013.
This took just under a year, 363 days and the price multiplied by 9,592 percent
From the 2nd halving which took place on July 9th 2016, the price went from $658 dollars,
to its peak of about 20 thousand, which happened December 11th 2017.
This was 527 days, or just over 1 year and 5 months and during this time the price multiplied
by 2939 percent
And finally from the 3rd halving, which happened May 11th 2020.
The price went from $8572 bucks, to its peak of 69 thousand dollars, which took place on
November 10th 2021.
This was 549 days or 1 and a half years and the price multiplied by 704 percent.
Now obviously from this data we can conclude, the length to hit our peak from a halving
date is increasing, and the percent increase of Bitcoin from halving date to peak, is decreasing.
So based on this data…when will the next Bitcoin peak be and what will the price be?
Well, based on this data…there was a big jump in days after the halving to reach a
peak from the 1st halving to the next, but then this slowed down on the third.
I would say this trend will be similar for this cycle, a slowdown thus I can conclude
the peak price will happen 560 days
Now the halving is estimated between early May and late June 2024, so we will just guesstimate
it happening on May 31st 2024.
560 days after this would put the peak price happening on December 12th 2025!!
So what will the price be?
Well the multiplier from the halving to peak price has been decreasing with each cycle,
the first cycle is an anomaly so we will leave that out.
It went from 9592 percent, to 2939 percent, to 704 percent.
From 9592 percent increase to 2939 percent is a reduction of about 70 percent, from 2939
percent increase to 704 percent is a reduction of about 76 percent.
I think taking the averages of these reductions is fair.
That would give us an average reduction of 73 percent.
A 73 percent reduction from 704 percent is about a 200 percent increase from the next
halving price for the next cycle.
Now we estimated the halving price to be $51,500…that would give us a peak price of 155,000 dollars,
happening December 12th 2025.
Hmmm that seems very likely in my opinion.
Let’s see how my predictions hodl up.
Cheers viewers I’ll see you next time!!