Bitcoin (BTC) experienced a 13% price drop in the past two days, falling from its new all-time high of $73,835 to briefly trade near $60,000. Analysts attribute this correction to overheated market conditions, referring to it as a “pre-halving retrace” ahead of the upcoming Bitcoin halving event, which is approximately 30 days away.
However, a report by CryptoQuant suggests that the Bitcoin bull cycle is not yet over. The report reveals that the level of investment flows from new investors is relatively low, and price valuation metrics are still below levels seen in previous market tops. According to CryptoQuant analysts, 48% of Bitcoin investment is coming from short-term holders, whereas the bull cycle typically ends with 84%-92% of investment from new investors.
The report also highlights that the current level of investment from short-term holders has reached levels similar to mid-2019 when Bitcoin experienced a significant correction. This is an important metric for short-term traders to monitor.
In addition, CryptoQuant’s valuation metrics are still below levels consistent with past market tops. The CryptoQuant profit and loss (PnL) index, which indicates the profitability of Bitcoin, is slightly below levels observed during the 2013, 2017, and 2021 bull runs. This suggests that there is still room for growth in the Bitcoin market.
Looking ahead, the upcoming Bitcoin halving event is expected to further boost BTC price and initiate a parabolic uptrend. CoinMarketCap’s halving countdown indicates that the event is less than 31 days away. With approximately 4,450 blocks remaining, the halving is set to occur on April 20, reducing miner block rewards from 6.25 BTC to 3.125 BTC.
Historically, Bitcoin’s halving has been associated with an increase in price and has preceded significant bull runs. Standard Chartered Bank has even raised its forecast for BTC price, predicting it to reach $150,000 in 2024 and a cycle top of $250,000 in 2025.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and exercise caution when making investment decisions.