The Halving's Effect On Bitcoin's PriceThis chart highlights Bitcoin's trend related to the halving, with dates of the three happenings represented by vertical black lines.
The trend is based on the 2016 - 2020 cycle. From the date of the halving, I mapped how many days it took for certain events to occur.
Green: Halving to Next All-Time High (518 days)
Orange: Halving to Bear Market Breakout (994 days)
Red: Halving to Cycle Low (882 days)
Purple: Lowest Time During Cycle (112 days)
Blue Arrow: Cycle High to Next All-Time High (1,085)
Teal: Cycle Low To Next Cycle High (1,064 days)
I then copied and pasted these timelines onto the rest of the halving cycles & noticed that each of them have been correct +/- 30 days.
There are purposely no price targets in this chart, only date targets.
Keep it simple. It's all just supply and demand.
Here’s a breakdown of the human psychology that drives this price action cycle after cycle.
Year 1 after halving: The halving happens and let’s assume demand for Bitcoin stays consistent with the previous year. The supply is growing at only 50% the rate it used to. The laws of supply and demand say that price goes up. That’s historically been the case the year after the halving.
Year 2: With the price having gone up over the past year, word of mouth begins. Whispers of an investment going up ~3x in a year spreads through group chats and conversations with friends. New folks want to make money too, so they buy, driving demand up. Year 1 & 2 are where most of the price increase happens.
Year 3: What goes up, must come down. Folks who bought two years ago could be up 5,10x, 20x on their initial investment. They begin cashing in, and demand starts to slow down. People begin to lose money and decide to sell, causing many others to do the same. Demand is way down, and so is price.
Year 4: With price having gone down 50-70% the year before, long-term investors are scooping up crypto at a great price if they plan to hold until the next cycle. With those investors bringing demand back to life, price begins to go up. WIth the halving coming soon, the cycle starts over again.
