Markets
Bitcoin Breakout Delay Signals Healthy Bull Market, Analyst Suggests
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Bitcoin’s prolonged period of price consolidation could be setting the stage for a robust bull market, according to technical analyst Rekt Capital.
“The fact that Bitcoin is struggling to stand out is beneficial for the overall cycle,” Rekt Capital explained in a recent publish in X.
“This ongoing consolidation is allowing the price to resynchronize with history [halving] cycles so that we can get a normal, habitual [bull run],” he added.
Rekt Capital suggested that current market behavior is in line with historical halving cycles. He also noted that Bitcoin’s struggle to break out soon after the halving is typical and avoids an accelerated cycle that would result in a shorter bull market.
In a separate post, he highlighted that Bitcoin has entered the reaccumulation phase, with consolidation potentially extending for another three months based on previous patterns.
“It should not be surprising, therefore, if the price rejects the high resistance band,” stated Rekt Capital.
Despite reaching a new high of $73,000 in mid-March before the halving, Bitcoin has not seen a significant recovery since then. According to Crypto Quant, the fact that Bitcoin has not yet seen a major price rally could be linked to the slowdown in USDT market capitalization.
Ultimate Puzzles
With Bitcoin halved and the Bitcoin ETF spot decision Behind us, the US presidential elections and macroeconomic factors are seen as potential positive catalysts for Bitcoin.
The upcoming US presidential election in November has brought encryption to the forefront of some political discussions. Standard Chartered suggests that a potential return to office for Donald Trump could positively impact the value of Bitcoin. The bank also believes that a Trump victory could benefit the overall US crypto scene.
Another factor that could benefit the Bitcoin market is the Federal Reserve’s (Fed) timeline for interest rate cuts. Future rate cuts are expected to bring greater liquidity to markets, potentially benefiting Bitcoin and other cryptographic assets.
The Fed held rates steady at the June FOMC meeting. Fed Chairman Powell, citing continued high inflation, indicated a cautious approach with the potential for one cut this year and four in 2025.
CME FedWatch Tool suggests a near certainty of an expected rate cut in December, rising from around 85% last week to almost 97%.
Bitcoin rose on Wednesday after cooler than expected inflation data. May’s CPI showed inflation at 3.3% year-on-year, beating estimates of 3.4%. Underlying inflation also fell by 3.4%, compared to the 3.5% forecast.
However, the bullish momentum was short-lived. Briefly after approaching $70,000, BTC dropped to $67,500 on Wednesday and extended its correction on Thursday, reaching $66,400, according to data by CoinGecko.
At the time of writing, BTC is trading around $66,800, down 6% in the last seven days.
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