Bitcoin approaches halving event, analysts speculate on price trends

Author: Sebastian Sinclair, blockworks Translation: Shan Ouba, Golden Finance

Bitcoin (BTC) is less than six months away from its next halving event expected in early April next year, prompting analysts to speculate on its price trend. BTC has risen more than 66% this year to $27,600, posting its first September rally in seven years. According to Cathie Wood’s Ark Invest, recent data shows subtle changes in cryptocurrency behavior.

In its latest Bitcoin Monthly Report, the asset manager noted some notable observations, including that the asset may be in a “cyclically oversold zone.” The report mentioned: Bitcoin’s realized profit to realized capital ratio closed at 0.02% in September, slightly higher than the annual low of 0.01%. This oversold situation has only occurred seven times in Bitcoin’s history. Ark’s data also shows that Bitcoin is mainly concentrated in the hands of long-term holders. Although the asset's price fell on Monday, some attributed it to the ongoing conflict in the Middle East. Specifically, 76% of the total Bitcoin supply is currently held by individuals who have not made a transaction in more than 155 days. This could mean a reduction in Bitcoin’s availability for active transactions.

Blockchain analytics firm Glassnode reported last week that the total amount of Bitcoin held long-term or presumed lost hit a five-year high, surpassing 7.9 million BTC.

Bitfinex analysts said that in the broader financial sector, **Bitcoin’s price action appears to be different from traditional stock markets. **Bitcoin’s price has recalibrated ahead of the S&P 500’s recovery from a low of 4,200 earlier this month. According to their analysis, correlation indicators show that Bitcoin’s correlation with stocks fell to -0.5 from 0.8 on August 25, indicating a sharp contrast with the movements of the world’s most important digital assets and traditional stocks. This usually happens when either asset class suddenly gets bullish or bearish, or when information moves the price of Bitcoin or the U.S. stock market faster than the other.