3 Top Reasons To Buy Bitcoin (BTC) On May 1

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As a researcher with experience in the crypto market, I believe that the current bearish trend is a temporary setback, and investors should consider the long-term prospects of Bitcoin. The third halving on April 20 has significantly reduced the daily production of new Bitcoins, which will eventually lead to an increase in demand and a potential parabolic rally. Moreover, the approval of Bitcoin ETFs has improved sentiment for digital assets and attracted institutional investors.

The crypto market is painted red across the board. Bitcoin, the front-runner in the digital currency sphere, experienced a 17% decline over the past month, marking an end to its seven-month winning streak. A 14% downturn in the previous week and an additional 8% decrease within the last day pushed Bitcoin’s price down to $57,258 on Wednesday.

A previous analysis indicated that the Bitcoin price might drop lower beyond its current support at $60,000 to find a new floor following the halving event. Possible depths for this correction could be around $56,000 or even $52,000.

As a Bitcoin analyst, I would advise investors contemplating a purchase prior to the anticipated bull market in 2024 to take into account several compelling reasons for doing so. Among these factors are:

1. Bitcoin Halving

The third reduction in Bitcoin rewards for miners took place on April 20th. This change brought down the reward from 6.25 Bitcoins per block to 3.125 Bitcoins. Halving is a built-in mechanism in the Bitcoin blockchain, designed by Satoshi Nakamoto, which ensures the generation of new Bitcoins while maintaining its inherent scarcity.

As a researcher studying the Bitcoin market, I’ve observed an important decrease in the daily production of new Bitcoins from 900 coins to 450 coins. This reduction in supply gradually squeezes the market, setting the stage for potential optimum conditions. Simultaneously, demand for Bitcoins is anticipated to surge, which could lead to a parabolic rally, causing significant price growth.

The Bitcoin price may experience a brief surge following a halving event, but the significant effects typically emerge several months later, leading to explosive growth and new record-breaking prices.

As a researcher studying the cryptocurrency market, I can tell you that with the latest Bitcoin halving event, there’s a strong expectation that its price will surge above $100,000 in the coming months. This bullish trend is likely to lift altcoins such as Ethereum and Solana as well. For investors eagerly awaiting this market upturn, I would recommend implementing a dollar cost averaging (DCA) strategy starting from May 1. Given that Bitcoin currently trades at a substantial discount compared to its all-time high of $73,737, according to CoinGecko statistics, this could be an opportune time to begin your investments.

2. Bitcoin ETFs Impact on Bitcoin Price

After gaining approval in January, the surge in demand for Exchange-Traded Funds (ETFs) significantly fueled Bitcoin’s price increase to unprecedented highs. Nevertheless, this bullish momentum started to fade about a month before the scheduled halving event in April, ultimately giving way to bearish control over Bitcoin’s market.

During our conversation on Monday, it was noted that the total daily net withdrawal amounted to $81 million, primarily driven by Grayscale’s GBTC withdrawals. The withdrawal volume decreased to $51 million on Tuesday, resulting in a cumulative net inflow of approximately $11.94 billion, based on SoSoValue’s data.

3 Top Reasons To Buy Bitcoin (BTC) On May 1

As a crypto investor, I can’t stress enough the significance of the Bitcoin ETF’s introduction to the market. This development is poised to enhance the general mood towards digital assets, potentially leading to an increase in volume and price. The green wave in trading could encourage more buy orders from those currently holding back, eagerly waiting for a favorable market shift.

With the reduction in supply brought about by the halving event and the surge in demand fueled by the launch of the Bitcoin ETF, the cryptocurrency’s price could reach new heights. Investors who secure their positions early on will be well-positioned to reap substantial returns over time.

3. Bitcoin Price Weakening Technical Outlook, A Bullish Signal?

The price of Bitcoin seems to be teetering at the peak of a steep rise. With the previous critical support at $60,000 now shattered, it’s only a matter of time before Bitcoin touches the subsequent significant level at $52,000.

The technical indicators signaled a shift in Bitcoin’s (BTC) structure, making it more likely for the price to drop towards or even hit $50,000. The MACD indicator, which is a popular tool among traders, has triggered a sell signal, suggesting that investors consider shorting BTC in the near future.

3 Top Reasons To Buy Bitcoin (BTC) On May 1

With the nearly overbought condition of the Relative Strength Index (RSI) for Bitcoin at 37, there is a noticeable increase in selling pressure. This situation may entice additional traders to enter short positions, aiming to capitalize on potential price declines in the near future.

As an analyst, I would interpret oversold conditions for Bitcoin as a sign that the price may be on the verge of reversing its trend. In simpler terms, purchasing Bitcoin on May 1 could potentially lead to profitable gains, even if further declines below $60,000 are expected in the near future.

Bottom Line

Having a pessimistic view on the crypto market can bring difficulties and opportunities for investors simultaneously. For those who purchased Bitcoin near its peak, they may need to be patient and endure the downturn until the asset bounces back. On the other hand, this market dip could represent an excellent chance for new investments at discounted prices, potentially leading to significant returns in the future.

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2024-05-01 15:28