- Bitcoin tend to take a strong bid six months ahead of halving the reward, according to historical data.
- By halving the event maturing in May 2020, BTC can rise above the recent high of $ 10,350 in November and could challenge the 2019 high of $ 13 880 over the next few months.
- Short-term contractors interference triangle on hourly chart shows the space for a decline to $ 8820 within the next 24 hours. Case bears will be canceled if the price rises above the hourly chart resistance at $ 9245.
- A quick move above $ 9,245 and rally to the 100-day average at $ 9606 should not be ruled out, as the latest pullback from the $ 10,350 does not have the support of volume.
Bitcoin is likely to give a good show in November with a positive event-prices because in six months.
Number one cryptocurrency by market value is left in October on a positive note, having rebounded sharply from five-month lows below $ 7,500 views a week ago.
rally could be extended next month, as cryptocurrency set to undergo halving mining prize in May 2020. This process aims to curb inflation by reducing the bitcoin reward per block mined in blockchain by 50 percent every four years.
Currently, miners gain 12.5 BTC for each block mined. That will go down to 6.25 after halving BTC, which means 50 percent fewer Bitcoins will be generated every 10 minutes. In other words, the supply of new coins will drop by half after May.
In the past, cryptocurrency has taken a strong bid six months ahead of halving the reward.
This Bitcoin block reward BTC cut from 50 to 25 November 2012. The BTC BTC rally from $ 5 to $ 16 in three months to mid-August and build a new base of about $ 10.00 in November.
On the same lines, BTC has jumped from $ 360 to $ 780 in four months, until mid-June 2016, before trimming gains and fell back to $ 465 in August, when the block of rewards cut from 25 to 12.5 BTC BTC.
The data show the market began to price in supply will come cut to six months in advance.
So, if history is a guide, BTC will rise far above the recent high of $ 10,350 in November and could challenge the 2019 high of $ 13 880 over the next few months.
Adding to the possibility of a rally, bitcoin has scored gains in November in six of the last eight years.
Particularly, November is the month that green for six consecutive years from 2012 to 2017. The winning run ended last year with a 37 percent decline – the largest loss on record November. At that time, however, the BTC is in a bear market. cryptocurrency already dropped 70 percent from a record high of $ 20,000 until December 2017.
This time, the overall trend is bullish, as shown by the three-digit gains year-to-date. BTC, therefore, is likely to revive tend to win in November.
Currently, bitcoin changed hands around $ 9,100 on Bitstamp, representing a decrease of 0.2 percent on a 24 hour basis. cryptocurrency trapped between key moving average (MA), as seen in the graph below.
Daily and hourly charts
Bitcoin has come under pressure in the last 24 hours, as expected, but the downside was limited to about the 200-day MA, currently at $ 9,025.
Contractors breakdown triangle visible on the hourly chart shows that bitcoin could drop further to former resistance-turned-support at $ 8820 No Violation will expose next support line at $ 8,474.
prospects, according to hourly chart, will turn bullish above the level of the lesser of $ 9245. A quick step over $ 9245 can not be ruled out as the latest pullback from the $ 10,350 accompanied by a decrease in trading volume. A low volume correction is often short-lived.
A break above $ 9,245 is likely to generate a retest of the 100-day MA at $ 9606. Note that BTC has failed three times in five days to sustain gains above the long term average. As a result, close to UTC above the 100-day MA could embolden the bull, which leads to a sustained move above $ 10,000.
Disclosure: The author does not hold cryptocurrency assets at time of writing.
Bitcoin image via Shutterstock; charts by Trading View