Bitcoin nearing its peak: Analyst warns against risky decisions!

Bitcoin nearing its peak: Analyst warns against risky decisions!

Bitcoin (BTC) is currently in a bull market, but there are growing concerns about the near end of this cycle. Market analyst Rekt Capital warns that the peak could be reached sooner than many investors expect. According to historical data, the Bitcoin cycle is likely to peak within the next few months. Rekt Capital analyzes the current market structure and compares it to previous halving cycles that took place in 2016 and 2020.

With the end of 518 to 550 days after a halving, which took place in April 2024, we are now around 88 percent of the post-halving period over. Experts believe the potential peak could be between late September and mid-October 2025. While some investors hope for an extension of the cycle until 2026, Rekt Capital urges caution and warns against excessive expectations. The risk of missing the ideal time to take profits is increased.

Risks for investors

A unique feature of this cycle is the long reaccumulation phase that Bitcoin has undergone. After the halving, the Bitcoin price was able to remain in a consolidation phase for eight months, which led to a correction of the pre-halving increase. Now Rekt Capital is seeing declining momentum that typically preceded a new upswing in previous cycles. These price discovery corrections, which we have already seen in 2017 and 2021, are giving rise to expert estimates that the risk of a sharp pullback is increasing.

Price movements so far show that Bitcoin often rises after halving events. Each halving reduces the reward for mining new blocks and leads to a shortage of supply, which further influences the price. In the past, prices received significant increases after halvings. For example, after the 2012 halving, the price rose from just about $12 to $100, and after the 2016 halving, from $650 to almost $20,000 by December 2017. Historical data suggests that such patterns could repeat in this cycle as well.

Preparation for possible corrections

Despite the positive market sentiment, the Bitcoin market remains volatile and shows the potential for significant corrections of up to 60 to 70 percent following a bull market peak. Rekt Capital advises investors to focus on risk management and preparation. Time overruns beyond the expected time window should be considered a bonus.

Bitcoin is currently trading at around $109,000, just slightly below its record high of $112,000. Market developments are also determined by institutional investors and regulatory changes. In particular, the MiCA regulatory package in the EU and the possibility of Bitcoin ETFs could significantly increase institutional participation in the Bitcoin market.

Looking into the future shows that forecasts for the coming cycle vary. Some analysts expect price targets of up to $100,000, while others recommend a more cautious approach to identify global economic changes, technological developments and regulatory measures as risk factors.

In a fast-moving market like the Bitcoin market, it is therefore crucial to develop market-appropriate investment strategies, whether through dollar-cost averaging or through strategic timing. Tax considerations are also important to understand the impact of Bitcoin investments on individual tax burdens.