- Bitcoin may have peaked this cycle, and what awaits investors could be a sharp drop in the value of the token.
- This is according to veteran chart analyst Peter Brandt, who predicted a sharp decline in Bitcoin prices in 2018.
- He points out that each Bitcoin bull cycle from 2009 to 2021 saw a 20% decline in profits.
Bitcoin may have peaked at a high of around $73,000 in March, and what awaits investors could be a 50% drop in the value of the token.
This is according to Peter Brandt, a veteran chart analyst and founder of factor trading, who successfully predicted the Bitcoin crash that lost about 80% of its value in 2018. did.
“It happened. It's real. You may not want to believe it, but I think there's a 25% chance that Bitcoin has already reached its highest price this cycle,” Brandt recently said. I wrote it in my notes.
He expects the stock to plummet to a 2021 low in the mid-$30,000 range, adding that this would be about a 50% drop from current levels.
Brandt backed up his rationale with a concept he calls “exponential decay,” in which each Bitcoin bull cycle from 2009 to 2021 contracted by about 20% compared to the previous one.
When applied to the latest bull market, the exponential decay indicates that the current bullish trend could increase by approximately 4.5 times the growth seen in the previous cycle from 2018 to 2021.
Given that framework, this cycle's high is expected to reach $72,723, a milestone the world's largest cryptocurrency surpassed in March, signaling the end of Bitcoin's bull run for now. may prove it.
“The reality is that the Bitcoin bull market cycle has lost a tremendous amount of momentum over the years,” he said.
However, Brandt pointed out that even if Bitcoin loses momentum after such a sharp rally, it might not be such a bad thing, with gold showing a similar move and continuing into 2022 after a period of big gains. It hit a low in the second half of the year, then rebounded sharply to new highs this year. .
“From a classical charting perspective, a decline like this is the most bullish thing that can happen in the long run. If you want to see an example of such a chart structure, see August 2020 to March 2020 2024,” he wrote.
After soaring to $73,835 in mid-March, the token has languished. Bitcoin's halving, which took place this month, was widely expected to be a bullish trigger, but so far it has failed to meaningfully boost the price. Concerns about hawkish monetary policy have reignited in recent weeks as inflation remains high, causing prices to fall further.
Bitcoin was trading around $62,955 on Tuesday, down about 15% from its all-time high in March.
