Key facts:
Several analysts have bullish expectations for bitcoin for the remainder of 2024.
If history repeats itself, Bitcoin’s rebound would begin in the third quarter of the year.
Bitcoin (BTC) has been providing good buying opportunities at low prices over the past week. In that period, the price of the digital currency has reached $52,500.
These prices are around 20% below the historical maximum reached in March 2024, close to 74,000 dollars.
The following chart, provided by TradingViewallows us to observe the Bitcoin price so far this year:
As indicated in the title of this column, The moment when bitcoin will bounce back is approachingVarious signs, both technical and fundamental, make this evident.
Dollar interest rate cuts are on the horizon
BTC is no stranger to macroeconomic events taking place worldwide. And in September, the long-awaited cut in interest rates in the United States, the world’s leading financial power, is expected to take place.
More precisely On September 18, the Federal Reserve (Fed) will meet to determine the new interest ratesIf a cut were to occur, it would be the first in more than 4 years, as can be seen in the following chart:
A US interest rate cut could be a significant catalyst for the price of bitcoin and other assets considered “risky,” such as tech stocks.
When interest rates fall, the cost of money is reduced, allowing businesses and investors to access cheaper loans. This tends to boosting investment in volatile assets which, while carrying greater risk, also offer potentially higher returns than the predictable Treasury bonds. Bitcoin, perceived by many as a store of value and at the same time a speculative asset, benefits as investors seek to escape the low returns of more conservative investments.
In this regard, the yield on Treasury bonds, one of the traditional safe haven assets, plays a key role. When interest rates are high, Treasury bonds offer an attractive return without having to take on too much risk (they are often considered “the safest investment in the world”). However, a rate cut decreases that return, making them less attractive for investors looking for higher returns. As a result, capital flows tend to be redirected towards assets such as bitcoin, which can offer higher returns in the context of an expansionary monetary policy. In short, the harder it is to find decent returns on safe assets, the more attractive it becomes to “bet” on higher volatility options, and bitcoin is positioned as an ideal safe haven in that sense.
Moreover, the impact of lower interest rates not only affects investment decisions, but also consumer decisions and business behavior. As the cost of credit falls, both consumers and companies are more willing to spend and invest. This creates greater liquidity in the markets and can ultimately create an environment of financial euphoria in which Volatile assets like bitcoin are driven higherIn this context, large institutional investors are also taking advantage of cheap money to expand their portfolios and incorporate assets with great growth potential.
In fact, in previous scenarios where interest rate cuts have occurred, such as In 2020, Bitcoin showed an impressive rallywhich can be seen in the graph below:
Back then, the additional liquidity injected by the Federal Reserve, coupled with near-zero rates (0.25% to be precise), sparked a boom in bitcoin prices, which rose from below $10,000 to reach an all-time high in just one year.
If history repeats itself, the Bitcoin bull run is coming
On the other hand, it should be noted that Bitcoin has had a fairly cyclical behavior in its prices. About six months after each halving, BTC began the bullish cycle that led it to mark new historical highs.
The analysis platform TradingView It has an indicator called “Bitcoin Halving Cycle Profit” which shows that, historically, between weeks 40 and 80 after each halving have been good areas to take profits.
Therefore, if the “rule” is fulfilled again, Bitcoin could be marking new all-time highs between February and November 2025.
How high could Bitcoin go in this bull cycle?
Answering this question is entering the realm of speculation and, of course, it is impossible to make an infallible prediction. Anyway, let’s look at some analysis and opinions.
According to the automatic detector of the “cup with handle” pattern that is available in TradingView, the target price for bitcoin would be $125,000.
Influencer and trader David Battaglia is more optimistic. “Bitcoin is going to $180,000” wrote yesterday in his X account. This is based on the hope that large interest rate cuts are coming and that this, for the reasons explained above, will be a trigger for the price of BTC.
On the current state of the bitcoin price, Battaglia says:
«Days like these, when everything is bleeding, are excellent for building long-term wealth. September is the best month of the year. The FED is going to lower rates, the dollar is going to devalue and the debt will continue to grow.»
David Battaglia, trader.
For his part, the Spanish trader who identifies himself on social networks under the pseudonym “SantinoCripto” ensures Bitcoin is “in a typical market bottom scenario.” He argues that “all the news in the mainstream media about cryptocurrencies is about price levels below $50,000 and even $40,000.” He adds that “90% of the news about the sector is negative, there is absolutely no interest from the general public and the trading volume in cryptocurrencies is at its lowest level in the last year.”
For SantinoCripto, Bitcoin will reach prices of at least $115,000 or $120,000 in this bullish cycle and then fall, perhaps, to the $40,000 zone, as can be seen in the following chart:
DCA, a strategy for an uncertain market
In times like these, where the landscape is full of uncertainty and volatility, it is easy to get carried away by fear or unreasonable expectations. However, for those who have been in the cryptocurrency ecosystem for a while, the history of bitcoin has shown that The cycles of rise and correction are a natural part of its evolutionThere is no way to predict with certainty when the next high will be or whether we still have further to go down, but what is clear is that current prices could offer unique opportunities for those who implement sensible strategies.
One option is the strategy of dollar cost averaging (DCA)buying small amounts of bitcoin at regular intervals, without worrying about identifying the exact “floor.” This reduces the impact of volatility and takes advantage of market fluctuations more efficiently.
In turn, A complementary approach would be a “reverse DCA” for profit-taking during bullish rallies, ensuring that emotions do not get in the way of prudent financial decisions. Bitcoin has proven its resilience time and time again, and perhaps, for those playing the long game, this could be another chapter in its growth story. For those interested in this strategy, the Cryptopedia (educational section of CriptoNoticias) has content that will prove useful.
Disclaimer: The views and opinions expressed in this article belong to the author and do not necessarily reflect those of CriptoNoticias. The author’s opinion is for informational purposes only and does not constitute investment advice or financial advice under any circumstances.