Fintech
What does the fourth quarter of 2024 have in store for us?
Bitcoin has just crashed, falling below $54,000 and its key 200-day moving average! This sudden drop comes as two major events rock the cryptocurrency market: Mt. Gox is finally returning funds to creditors and the German government is dumping its seized Bitcoin.
As Bitcoin enters its long-awaited summer lull, renowned cryptocurrency analyst Benjamin Cowen has highlighted this period of stagnation. Cowen has often discussed Bitcoin’s summer slowdown, a period in which its price tends to decline or remain static.
Now that this period has arrived, he is turning his attention to potential market trends for the rest of the year.
Can Bitcoin Breakthrough?
The critical question is whether Bitcoin can climb back above its Bull Market Support Band (BMSB) in the coming weeks or whether it will continue to face resistance. In a recent thread, Cowen noted that Bitcoin is currently falling below its BMSB during the summer of 2024. This pattern is not new; similar trends have been observed in previous years.
For example, in August 2023, Bitcoin fell below its BMSB, stayed there for a few weeks, and then made a strong recovery in the fourth quarter.
We talked a lot about the idea of a #BTC summer calm well in advance. Now that it has happened, what will happen?
I think what happens in Q4 2024 depends on whether #BTC It may return above its bull market support range in the coming weeks, or if it holds resistance.
A thread 👇
— Benjamin Cowen (@intocryptoverse) July 7, 2024
Historical models and forecasts
In 2013, Bitcoin bottomed in early July, but quickly bounced above the 21-week EMA, leading to a significant rally in Q4. In contrast, in 2019, Bitcoin’s summer decline persisted below the BMSB after the Federal Reserve cut interest rates, resulting in further declines in Q4.
Cowen also draws parallels between Bitcoin’s current performance and its post-halving period in 2016. This similarity suggests we could see comparable trends this time around. Historically, Bitcoin tends to peak in Q4 of the post-halving year, which for the current cycle would be 2025.
Key factors to pay attention to
Several key factors will influence Bitcoin’s future movements:
- Bullish Market Support Band:If Bitcoin can climb back above its BMSB, a crucial level to determine its direction.
- Federal Reserve Policies: Changes in interest rates can have a significant impact on the market.
- Market sentiment: Investor confidence and trading volumes play a crucial role in Bitcoin’s performance.
- Ethereum Performance: In particular the ETH/BTC ratio, which has shown similar trends to past cycles.
A Look at Q4 2024
According to Cowen, Bitcoin’s fate in Q4 2024 depends on its ability to regain its position above the BMSB. If it follows the patterns of 2013, 2016, and 2023, a strong recovery and rally could be on the horizon. However, if it mirrors the trend of 2019, Bitcoin could continue to struggle.
As we navigate the summer slowdown, all eyes will be on Bitcoin’s ability to break out of current resistance and the various factors that will determine its path in the coming months.
Read also: 2024 US Voters Are Pitching Bitcoin: What’s Fueling the Crypto Fever?
The future of Bitcoin remains uncertain. What are your hopes for the rest of the year?