According to prominent crypto analyst Rekt Capital, the worst-case scenario for Bitcoin in the next 5.5 months leading up to the May 2024 halving event would be a revisit down to the ~$20,000 level.
From current prices of around $34,500, that would represent a 42% drop. However, Rekt Capital notes that worst-case scenarios rarely play out, as they typically have low probabilities.
Bitcoin put in a major bottoming formation around $20,000 earlier this year after the spectacular collapse from all-time highs. That zone represents the maximum pain point reached during the recent crypto winter.
For Bitcoin to retest those lows now after a relief rally, a dramatic shift in market structure would need to occur. Multiple key support levels between $30,000 and $20,000 would have to break down.
With the next block reward halving now just 5.5 months away, Bitcoin is entering a historic pre-halving period. The 2020 halving began a parabolic bull run that peaked at $69,000.
If past halving cycles are any indicator, Bitcoin tends to consolidate sideways or upward in the months preceding a halving event before breaking out dramatically in the 12–18 months after.
While the ~$20,000 area remains feasible as a macro-higher timeframe support zone, a swift revisit there from current levels seems unlikely. It would take a major black swan event or global economic shock to trigger such a drop in the short term.
As Rekt Capital notes, worst-case scenarios rarely play out in the expected fashion. Rather, they exist as tail risks with low probabilities.
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A return to ~$20,000 worst-case lows can’t be fully ruled out but seems unlikely over the next 5 months considering prevailing market conditions, according to crypto analyst Rekt Capital. However, prudent risk management means always preparing for less-expected scenarios while focusing probability on higher-likelihood outcomes.
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