Post Bitcoin Halving Drop ???
Hi friends hope you are well. Today I want to discuss that is it necessary for the Bitcoin to drop pre or post halving? In order to understand this principle we need to see the previous Bitcoin halvenings then we will move to the current having. If we watch the Bitcoin halving 2012 then we can observe that before halvening the price action dropped more than 25% and this bearish move was ended before the halving. On the other hand if we watch the Bitcoin halving 2016 then the price action started dropping down before the event and this bearish move was continued even after the halving event. During this drop BTC lost more than 40% of its value.
Now if we move to the current halving event then it can be seen that before halving we have witnessed a very strong bearish move that leaded the BTC more than 65% down in the March 2020. Most of the traders say that this drop was due to the world pandemic issue. Therefore it is possible that this down move doesn't have any connection with pre or post halving drop. If we accept this then we can expect that the drop has been started since 8th of May when the price action reached at $10000 and started dropping down.
The exponential moving averages:
Moreover if we see the movement of price action with the exponential moving averages with the time period of 10 and 21. Then it can be seen that in 2012 the EMA 10 crossed down the EMA 21 before the Bitcoin halving. And after the halvening we can observe only a weak downtrend and during this weak trend the EMA 10 went very close to the EMA 21 but did not form a bear cross. After that both EMAs started moving up and then Bitcoin achieved more than 10000% profit within next one year.
On the other hand in 2016 we can see that the EMA 10 formed the bear cross with EMA 21 after the Bitcoin halving then again the exponential moving average 10 crossed up EMA 21 and Bitcoin achieved more than 3000% bit gains within next one and a half year.
Now let's move to the Bitcoin halving 2020 then it can be clearly seen that at this time EMA 10 is moving down and likely to form a bear cross with EMA 21 very soon. Even though the new candlestick has been opened below the EMA 21 but we cannot consider that the price action has broken down this EMA unless this candlestick will be completely opened and closed below exponential moving average 21. And we should wait for the death cross between two these two EMAs then we can expect a further very strong downward move before any long term bullish movement after Bitcoin halving.
The price action may follow the relative strength index trend:
In my previous post we have discussed that if the RSI is in downtrend but the price action is moving sideways or upward then finally the price action embrace the signal of relative strength index and it also moves down. At this time we can see that the RSI is in down trend even and this trend can be seen even on the daily chart, therefore the price action can start a downward move at anytime. However if the RSI will change its trend then the price action might not move down.
Up channel:
As we have already seen in my previous post that the Bitcoin has formed an up channel on the daily chart. And after hitting the resistance at $10,000 the price action drop down at the support of this channel. This time the price action is moving with the support, therefore there can be chances that the priceline will move up again from here to hit the resistance of the channel. But if the support of the channel will be broken down then the leading cryptocurrency can start a strong bearish rally.
Bullish pennant:
On the other hand on the same daily chart the price action of Bitcoin has formed a bullish pennant. At this time the price action is at the support of this pennant. And after hitting the resistance at this time BTC is at the support of this pennant and the green bullish candlesticks are appeared showing the tendency of the priceline to move up. The support of this pennant is also very critical if it will be broken down in the price action can start a strong bearish move as we have discussed in case of breaking down the channel support as well.
The formation of bullish BAT:
Now I would like to drive your attentions towards a very important move and that is the formation of bullish BAT pattern on the daily chart. At this time priceline of BTC is forming the last leg of this is BAT. And for the completion of this final leg we need the retracement between 0.786 to 0.886 Fibonacci sequence that starts from $8500 and ends up to $8300. If the price action will complete this is BAT that then there will be strong chanes that the price action can start a very strong bullish move from the potential reversal zone of this bullish BAT pattern. However the potential reversal zone of this pattern should be considered as stop loss. Because if the price action will break down this level then it can move more down for the formation of bullish Crab pattern.
Conclusion:
It is confirmed that post halving the Bitcoin starts very strong and long term bullish rally, however this is also a fact that pre or post halving period the Bitcoin also completes a bearish move as well. Therefore in case of breaking down the supports the Bitcoin can move further down, however if the supports will be saved then the Bitcoin can start long-term bullish move from here.
Note: This idea is education purpose only and not intended to be investment advice, please seek a duly licensed professional and do you own research before any investment.
Now if we move to the current halving event then it can be seen that before halving we have witnessed a very strong bearish move that leaded the BTC more than 65% down in the March 2020. Most of the traders say that this drop was due to the world pandemic issue. Therefore it is possible that this down move doesn't have any connection with pre or post halving drop. If we accept this then we can expect that the drop has been started since 8th of May when the price action reached at $10000 and started dropping down.
The exponential moving averages:
Moreover if we see the movement of price action with the exponential moving averages with the time period of 10 and 21. Then it can be seen that in 2012 the EMA 10 crossed down the EMA 21 before the Bitcoin halving. And after the halvening we can observe only a weak downtrend and during this weak trend the EMA 10 went very close to the EMA 21 but did not form a bear cross. After that both EMAs started moving up and then Bitcoin achieved more than 10000% profit within next one year.
On the other hand in 2016 we can see that the EMA 10 formed the bear cross with EMA 21 after the Bitcoin halving then again the exponential moving average 10 crossed up EMA 21 and Bitcoin achieved more than 3000% bit gains within next one and a half year.
Now let's move to the Bitcoin halving 2020 then it can be clearly seen that at this time EMA 10 is moving down and likely to form a bear cross with EMA 21 very soon. Even though the new candlestick has been opened below the EMA 21 but we cannot consider that the price action has broken down this EMA unless this candlestick will be completely opened and closed below exponential moving average 21. And we should wait for the death cross between two these two EMAs then we can expect a further very strong downward move before any long term bullish movement after Bitcoin halving.
The price action may follow the relative strength index trend:
In my previous post we have discussed that if the RSI is in downtrend but the price action is moving sideways or upward then finally the price action embrace the signal of relative strength index and it also moves down. At this time we can see that the RSI is in down trend even and this trend can be seen even on the daily chart, therefore the price action can start a downward move at anytime. However if the RSI will change its trend then the price action might not move down.
Up channel:
As we have already seen in my previous post that the Bitcoin has formed an up channel on the daily chart. And after hitting the resistance at $10,000 the price action drop down at the support of this channel. This time the price action is moving with the support, therefore there can be chances that the priceline will move up again from here to hit the resistance of the channel. But if the support of the channel will be broken down then the leading cryptocurrency can start a strong bearish rally.
Bullish pennant:
On the other hand on the same daily chart the price action of Bitcoin has formed a bullish pennant. At this time the price action is at the support of this pennant. And after hitting the resistance at this time BTC is at the support of this pennant and the green bullish candlesticks are appeared showing the tendency of the priceline to move up. The support of this pennant is also very critical if it will be broken down in the price action can start a strong bearish move as we have discussed in case of breaking down the channel support as well.
The formation of bullish BAT:
Now I would like to drive your attentions towards a very important move and that is the formation of bullish BAT pattern on the daily chart. At this time priceline of BTC is forming the last leg of this is BAT. And for the completion of this final leg we need the retracement between 0.786 to 0.886 Fibonacci sequence that starts from $8500 and ends up to $8300. If the price action will complete this is BAT that then there will be strong chanes that the price action can start a very strong bullish move from the potential reversal zone of this bullish BAT pattern. However the potential reversal zone of this pattern should be considered as stop loss. Because if the price action will break down this level then it can move more down for the formation of bullish Crab pattern.
Conclusion:
It is confirmed that post halving the Bitcoin starts very strong and long term bullish rally, however this is also a fact that pre or post halving period the Bitcoin also completes a bearish move as well. Therefore in case of breaking down the supports the Bitcoin can move further down, however if the supports will be saved then the Bitcoin can start long-term bullish move from here.
Note: This idea is education purpose only and not intended to be investment advice, please seek a duly licensed professional and do you own research before any investment.
Feragatname
Bilgiler ve yayınlar, TradingView tarafından sağlanan veya onaylanan finansal, yatırım, işlem veya diğer türden tavsiye veya tavsiyeler anlamına gelmez ve teşkil etmez. Kullanım Şartları'nda daha fazlasını okuyun.