Over the weekend, bitcoin (BTC) climbed from $9650 lows to slightly above $10,000. However, BTC was soundly rejected at the $10k level as it slumped back to the $9,650 level, before stabilizing above $9,770. This sudden drop came on the heels of the market opening at CME. According to data provided by Datamish, the dump liquidated over $24 million longs on BitMEX exchange.
Notably, this marked the third time the flagship cryptocurrency was rejected from the $10k hurdle in the last 14 days. Now, analyst DonAlt believes it won’t be easy for BTC to get back above $10k in the near-term.
Pre-Halving Lull: We Might Not Be Seeing $10k BTC Any Time Soon
After briefly touching $10k, BTC plunged to the 4-digit zone as the Bears dominated the crypto markets. The rejection at $10,000 is unnerving, but the biggest bearish signal is the cryptocurrency posting a lower high on the daily charts.
And if you are waiting for BTC to break above $10k again soon, I may have some terrible news for you. DonAlt, a crypto trader who has amassed 132.1k followers, is predicting that the top crypto could remain in the 4-digit area for a while.
The analyst noted:
“Still looking good for bears in my opinion. Given that I’m trading counter-trend, I moved my stop another step down just above $10,000. If I’m correct we won’t see $10,000 again for quite a while.”
$BTC update:
Still looking good for bears in my opinion.
Given that I’m trading counter-trend, I moved my stop another step down just above $10000.
If I’m correct we won’t see $10000 again for quite a while.
If I’m wrong, I’ll walk away with 2 weeks of funding + a couple % move. pic.twitter.com/j9BRr9TRrO— DonAlt (@CryptoDonAlt) February 24, 2020
The bulls have been on their game since the beginning of this year. BTC has registered year-to-date gains of nearly 40% and even hit $10,500 on 13th February. Much of this stunning performance was because of the positive market sentiment stemming from the rewards halving event that is less than three months away.
After the halving, miners will be receiving 6.25 BTC per block instead of the 12.5 BTC that they currently receive. Slashing miners’ rewards have always been viewed as a bullish catalyst in that, as BTC’s supply declines, the price will skyrocket as demand mounts.
Be that as it may, historical data paints a grim picture of the bitcoin price pre-halving. Binance CEO Changpeng Zhao recently posted a chart on Twitter which shows how Bitcoin has performed in the past, before and after halving. Per the chart, BTC posted massive gains a year before and a year after halving but remained rather stagnant in the actual year of halving. If history is anything to go by, the rest of 2020 is likely to be lackluster for BTC before fetching a new all-time high next year.
History may not predict the future, and correlation does not prove causation.
Here are just 2 charts around the previous #bitcoin halving. Watch what happens AFTER halving. Markets are inefficient, at least, historically.
Just data, draw your own conclusions. pic.twitter.com/AwChmAGvrK
— CZ Binance
(@cz_binance) February 23, 2020
Another Analyst Shares DonAlt’s View
DonAlt is not the only crypto analyst who thinks BTC is not going to see strong upward momentum in the near-term. TraderSmokey thinks BTC will remain flat for now, even though the CME gap has been filled. As such, he has closed his long position.
However, not everyone is bearish. Trader-cum-analyst Josh Rager believes BTC’s bullish outlook is intact as long as it does not break below $9,300.
He tweeted:
“Price dropped & bounced near the weekly/daily support around $9580. Holding above the $9,550s is a good sign on higher time frames and breaking below the $9,300s will still flip bear bias. Lower time frames in down channel but weekly chart still not confirmed trend reversal.”
In a follow-up tweet, Rager assured a follower that “it’s all good” and the bitcoin price will “boom by fall of this year.”
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