Market Milestones: Bitcoin's 4th Halving

[Image] Happy Friday , The SPY saw its 5th down day in a row as the market finally retreated from all-time highs in the first sizable dip since last October. The market was warning of this sell off since mid-February and has now retreated back to those mid-February levels. The Fed “pivot” last November was the driving cause of the vertical bull market over the last 5 months. The market was over the moon, and over extended, expecting seven rate cuts coming into 2024. The market is now realizing that inflation is stickier than molasses on a cold January morning and is starting to reprice equities accordingly. The recent inflation numbers have caused the market to drop their expectations from 7 to a meager 1 or 2 cuts in 2024. The [SPY short]( we shared on April 5th hit the 2R target and looks like it could have lower to go. However, after 5 bear days in a row, watch for some buying to come in and possibly retest the $508.00 level. For some context of how this correction could play out we can look back to July 2023. Both corrections started almost identically, and the bull moves prior to the corrections also share a lot in common. The charts still say that this is a time to remain a little cautious until better risk reward opportunities present themselves. SPY [Image]( We saw some cracks start to show up in the most bullish sector around, semiconductors. [TSM]( gapped down on good earnings with lowered guidance and closed with a high wave bearish candle. There is a pretty obvious double top forming after a very devious all-time high trap. If TSM takes out the low of Thursday’s candle, watch for the 100DSMA to act as the next area of support. [AMD]( also broke below a key support level at $160.00 and has a formed a large head and shoulders pattern. Earnings are just 11 days away and will be key to the next move on AMD. The $160.00 and $180.00 levels will now act as resistance and the bulls will have to battle for any push higher. While most semiconductor stocks have fallen, their brave and bold leader, NVDA, has managed to stand firm. NVDA filled its March 1st gap and bounced on Thursday, keeping alive the possibility for a move into $1000.00. NVDA [Image]( [Image] The 4th Bitcoin halving is right around the corner and will take place on Saturday, April 20th, 2024. There will be another 28 halvings after this one until all Bitcoin is mined sometime around the year 2140. There is plenty of halving-related content out there, so we will stick to the basics and most importantly, the charts. If you want more, simply Google “bitcoin halving,” and you will get enough content to keep you busy until the next halving. The Bitcoin halving is simply when the Bitcoin block reward is cut in half. This happens every 210,000 blocks, so it wasn’t pre-planned for this halving to take place on 4/20. It's just a happy coincidence so that Elon Musk could possibly start talking about a real cryptocurrency instead of a dog coin for at least one day. By decreasing the supply of Bitcoin coming onto the market, the halving is fundamentally bullish for the digital asset, and we have seen as much in the charts. The halvings have also helped contribute to the Bitcoin 4-year cycles where we see massive swings in both directions over similar time horizons. It took Bitcoin 52 weeks to reach its cycle top after the 2012 halving, 78 weeks to reach its cycle top after the 2016 halving, and 78 weeks to reach its cycle top after the 2020 halving. One could make a convincing argument that the cycle top in 2020 happened in April 2021, so that would actually make that cycle 48 weeks long. This means that some kind of cycle top could happen between March and October of 2025, if history is to repeat itself. All three of the halvings have also had a period of consolidation and accumulation after the halving. The shortest of which lasted 7 weeks in 2012 and the longest of which lasted 28 weeks in 2016. We have already seen that this cycle is different in at least two big ways. The first is that Bitcoin traded below its previous all-time high during the 2022 bear market. The second is that Bitcoin made a new all-time high before the halving. Neither has ever happened before. The recently launched Bitcoin ETFs caused the latter difference and have greatly impacted the Bitcoin price in 2024. They will continue to have an outsized effect on the Bitcoin price as it has given everyone, including institutions, an easy on-ramp into Bitcoin and legitimized it in the eyes of many. There is no doubt Bitcoin will continue to be an extremely volatile asset, but if history is any guide, the overall trajectory is up and to the right. The big question will be whether global liquidity and macro conditions are willing to play ball once again and allow for that rip-roaring “Fun Zone” we have seen in the past. Only time will tell, but the risk-reward on Bitcoin right now is still pretty solid and will be very attractive with another drop into the $50,000 region. BTCUSD [Image]( Strive On, Yates Craig, RLT Market Analyst [support@RLTNewsletter.com](mailto:support@rltnewsletter.com) Disclaimer: Trading involves inherent liabilities and risks. By accessing this newsletter, you acknowledge and understand the associated risks with trading and investing. This newsletter or email does not serve as a solicitation to buy or sell any security, and its content should not be construed as financial advice. The trades, analyses, and results presented are for entertainment and educational purposes only. These materials do not substitute professional advice from a qualified individual, firm, or corporation. 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