After The Bitcoin Halving, What Might Be Next For The Price?

In all big asset rallies there is a classic hockey stick form created in that asset’s chart. It is simply an exponential progression. Price growth piles onto price growth at an accelerating rate and the chart is like the exhaust cloud of a rocket launch.

This is normally caused by FOMO where buyers pile in, or perhaps lemmings jump off the cliff at an ever-accelerating rate. Obviously at some point there are no more buyers to ape in or lemming on the cliff top to follow the leader onto the rocks below. That is when a bubble bursts.

Now holders of assets don’t like the word bubble because that suggests an ongoing bust. Sadly, few bubbles escape such a terminus, and while those Captain Hindsight types laugh, the bubble/bust phase of an asset is very seldom anything but the start of a long story of growth. The greatest companies in the world are the children of the dotcom boom, for instance, and according to stats even tulips are still a 250 million dollar industry in Holland, shipping 3 billion post-bubble bulbs.

So right now, bitcoin and thus crypto in general is sideways trading at an elevated range between $60,000 and $70,000.

This is what holders want to see next:

And this is the determining equilibrium range:

So if you do not have a strong opinion on direction (and even if you do) the box encasing this equilibrium range is the thing to watch. This technique is an ancient technical analysis method born in the 1950s in a post-war tech bubble when stock charts were the province of people keeping tabs of prices by hand. It remains a great device for volatile upwardly repricing boom/bubble situations. The box represents an equilibrium range reached after a repricing event where the asset oscillates around with incoming noise awaiting the next big move up or down. When it reprices it loses the noise and heads off in one direction until it hits a new balance, and this is where bitcoin sits right now.

The final rally of crypto tends to come after the halving and is because there is simply half the new supply coming to market. The price jump has nothing to do with anything other than there being less new bitcoin entering the supply, so this pressure builds and builds until the market reprices to the new reality. This suggests there is at least another upwards surge to come.

If we do not get another leg up, I think that will signal the end of the crypto monster and the beginning of a new regulated tamed blockchain reality with little chance for the overnight emergence fortunes of the past.

However, I do think that bitcoin does have a move to $90,000 to $100,000 and even far beyond, but it is no means fate. So we sit back and watch and await the next repricing.

I actually see the following analysis as quite likely:

With the $100,000 level achievable on fundamentals, sentiment and round number logic. Many think the top is a lot higher but I will certainly let them have my bags for that end run situation.

Is there the next leg up, final or otherwise, is the only call at this stage and on balance I think there is. I still think it is the halving that is key and that is a chronic driver not an acute one. Either way, we have to watch that box range to judge whether bitcoin is going to rise like a rocket or drop like a rock.