Markets
Delayed Bitcoin Breakout Signals Healthy Bull Market, Analyst Suggests
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Bitcoin’s prolonged period of price consolidation could pave the way for a robust bull market, according to technical analyst Rekt Capital.
“The fact that Bitcoin is struggling to break out is beneficial for the entire cycle,” Rekt Capital explained in a recent statement. job on X.
“This continued consolidation allows prices to resynchronize with historical levels. [halving] cycles so that we can achieve normal and usual operation [bull run],” he added.
The analyst suggested that the current market behavior is consistent with historical halving cycles. He also noted that Bitcoin’s difficulty in exiting quickly after the halving is typical and prevents an accelerated cycle that would result in a shorter bull market.
In another article, he highlighted that Bitcoin has entered the reaccumulation phase, with consolidation potentially extending for another three months, based on past patterns.
“So it should not be surprising if the price breaks away from the high resistance range.” declared Rekt Capital.
Despite hitting a new high of $73,000 in mid-March before the halving, Bitcoin has not seen a significant rally since. According to Crypto Quant, the fact that Bitcoin has yet to see a major price rise could be linked to the slowdown in USDT market cap.
Final puzzles
With Bitcoin halved and the Bitcoin ETF spot decision behind us, the US presidential election and macroeconomic factors are seen as potential positive catalysts for Bitcoin.
The upcoming US presidential election in November has brought crypto to the forefront of some political discussions. Standard Chartered suggests that a possible return of Donald Trump to power could positively impact the value of Bitcoin. The bank also believes that a Trump victory could benefit the entire US crypto landscape.
Another factor that could benefit the Bitcoin market is the Federal Reserve’s (Fed) interest rate cut schedule. Future rate cuts should bring increased liquidity to markets, potentially benefiting Bitcoin and other crypto assets.
The Fed kept rates unchanged at the June FOMC meeting. Fed Chairman Powell, citing still-high inflation, indicated a cautious approach with the possibility of one cut this year and four in 2025.
CME FedWatch Tool suggests a near certainty of an expected rate cut in December, from around 85% last week to almost 97%.
Bitcoin jumped on Wednesday after colder than expected inflation data. The May CPI showed inflation at 3.3% year-on-year, beating estimates of 3.4%. Core inflation was also lower at 3.4%, compared to 3.5% expected.
However, the bullish momentum was short-lived. Shortly after closing in on $70,000, BTC fell to $67,500 on Wednesday and extended its correction on Thursday, hitting a low of $66,400, according to data from CoinGecko.
At the time of writing, BTC is trading at around $66,800, down 6% over the past seven days.
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