- Bitcoin price may not retest this year’s highs for another three to five months
- Bitcoin has fallen 11% in the second quarter and is off about 14% from its all-time high above $73,000 reached in March
- Analysts remain optimistic on bitcoin long-term, with one analyst’s base case being that bitcoin will reach $100,000 this cycle
Bitcoin has seen a sharp rally so far in 2024, but the summer doldrums may have come early for the cryptocurrency. After reaching an all-time high above $73,000 in March, bitcoin has fallen 14% from those levels and is struggling to maintain momentum.
Bitcoin’s Performance So Far This Year
Bitcoin is still up 48% for the year thanks to bullish enthusiasm surrounding the debut of US bitcoin ETFs in January and the April 19 halving event. The cryptocurrency is on pace for its first positive week in the past six, according to Coin Metrics. However, it has fallen 11% in the second quarter and has been rejected multiple times when attempting to break above $70,000.
Analysts Remain Bullish Long-Term But Expect Near-Term Caution
Analysts remain optimistic on bitcoin over the long run, citing factors like increasing institutional demand and reduced supply from the recent halving. However, they caution that bitcoin may continue to face headwinds in the coming weeks and could retrace to the $50,000 – $60,000 range in the near term.
According to HC Wainwright analyst Mike Colonnese, it could take 3-5 months for bitcoin to retest its recent highs. “We’re short-term neutral to cautious and bullish medium- to long-term on bitcoin and the miners,” he said.
Wolfe Research technical analyst Rob Ginsberg also sees signs of further near-term downside for bitcoin, despite a multi-year bullish outlook. “We continue to ask ourselves if the latest rejection at $70,000 was the beginning of an epic double top,” he wrote in a recent note.
Key Support Levels At Risk with $49,000 as Potential Downside Target
Bitcoin has held above $60,000 since early May after breaking below that level for the first time since February. However, analysts warn that bitcoin remains vulnerable below its all-time high and could see downside risk as low as $49,000 if key support levels are broken. This would represent a drop of over 30% from current levels.
Bitcoin Historically Peaks 1-1.5 Years After Halving Event
According to Colonnese, it’s still early innings for bitcoin this cycle. He notes that between increased institutional demand and reduced supply from the recent halving event, bitcoin’s supply/demand dynamics remain favorable.
Looking at previous cycles, bitcoin has historically peaked 1-1.5 years after a halving event, with each bull cycle running longer than the previous one. This suggests bitcoin may not reach its peak for this cycle until October 2025.
Conclusion
While bitcoin faces headwinds that could lead to a retracement to $50,000-$60,000 in the coming months, analysts remain constructive on its long-term outlook. However, patience may be required before bitcoin can retest its all-time highs. Factors like declining retail enthusiasm, macroeconomic uncertainty, and the potential for a double top pattern could limit upside over the next 3-5 months.
