Yesterday, the price of Bitcoin hit a new annual high, reaching almost $38,000, confirming some optimistic predictions.
Instead, the day before it even dipped below $36,000, albeit briefly.
This dynamic confirms Bitcoin’s moment of strength and seems to confirm some positive predictions that have been circulating for days.
Bull Run Hypothesis: Bitcoin Price Predictions
A hypothesis that has been discussed for several days now is that a new big bull run could be launched in this latter part of 2023, as it happened in 2020.
The fact is, however, that all three major runs that have occurred in the past (2013, 2017, and 2021) occurred the year after the halving (2012, 2016, and 2020), while the next halving will occur in April 2024
In fact, many expected that the next big rally in the crypto markets could start in late 2024 and continue through 2025.
However, the trend of price of BTC in this final part of 2023, he does not remember 2019, but 2020.
Comparisons with the past
Taking into account the last three months of 2019, we find that the price of Bitcoin it was downhill.
It must be said that generally at the end of the year, the price of Bitcoin either goes up or down, while it is very unlikely that it will lateralize. In fact, it is often better to sell or not to sell for purely fiscal reasons rather than deciding based on the market trend.
Usually in bear market years it is better to sell before the end of the year and this causes prices to fall. It is no coincidence that annual lows during bear markets are often recorded in the last quarter.
Something similar happened in 2019, when the price rose from $8,200 to $9,700 in October, but only then fell below $7,000 in November.
The descent began slowly at the end of October, and continued rapidly from November 15. In December, the price remained around $7,000, and it recovered only in January 2020.
Instead, at the end of 2020, the price started from $10,400 in October (the usual level for 2020) before first rising to almost $14,000 at the end of the month, marking new annual highs, and then in November it returned even close to previous historical highs highs always above $19,000.
In other words, it gained 84% in two months, with +32% in October and +19% in the first half of November.
The price of Bitcoin started in October 2023 at $27,000, which is the reference price for the current year.
October ended at $34,500, marking new yearly highs. The gain in October was 27%.
This October 2023 looks a lot more like October 2020 than October 2019.
Furthermore, the first 15 days of November this year ended with new annual highs and an increase of 10%, which is much more similar to the first half of November 2020 than that of 2019.
Indeed, to be honest, this last quarter of 2023 looks nothing like the last quarter of 2019, while instead it definitely shows more signs of similarity compared to the end of 2020.
Furthermore, Bitcoin’s current price strength seems truly remarkable, so much so that it may justify the hypothesis of a new bullrun, at least in theory.
Optimistic Bitcoin Price Forecasts
Therefore, it is not surprising that there are optimistic forecasts regarding the development of the price of Bitcoin in the coming months.
However, we must distinguish between the medium term and the long term.
As for the medium-term period, that is, the evolution until the end of the year, the hypothesis is that it could even exceed $40,000 by the end of November, and perhaps even approach $45,000 by the end of December.
To be fair, if it repeats the boom of 2020, it could even return to close to the all-time highs in December, but there aren’t many who are predicting a similar scenario at this point.
On the other hand, what happened in late 2020 was anomalous for a number of reasons, most notably the Fed’s strong QE.
Not only is there no Fed or ECB QE going on at the moment, there is QT going on, i.e. a slow withdrawal from the market of the huge amount of liquidity injected in 2020 and 2021. However, there is China injecting liquidity, and maybe that is helping the BTC price rise -And.
In the long term, however, the hypothesis is that the new big bullrun, which many initially expected for 2025, could arrive as early as 2024.
Levels to watch out for
These hypotheses, which are currently only hypotheses, need confirmation. If these confirmations do not arrive, they should be considered incorrect hypotheses.
The first confirmation must arrive by the end of November, and consists of a breach of $40,000 and a consolidation of the Bitcoin price trend above that threshold. At the moment, this seems to be an absolutely plausible hypothesis.
It should be emphasized once again that it is not only necessary for the price to reach that figure, but for it to stabilize above that threshold and stay there.
The second confirmation is expected in December, when an increase to $45,000 would be necessary. In this case, it is not necessary for the price of Bitcoin to actually reach that figure and stabilize above it, but only for it to show clear signs that it can easily reach it.
In fact, we should not forget that usually when prices rise at the end of the year, they then fall at the beginning of the following year, but during a bullrun they continue to rise even in January.
So, if the above two confirmations arrive, and then in January the price continues to rise, then the price rise would also be confirmed.
However, this would not necessarily mean inflating a new bubble or continuing the bullrun. It will be necessary to follow the evolution from day to day.