Bitcoin’s price surged above $65,000 on May 6, hitting $63,712, with analysts suggesting that the post-halving “danger zone” might be behind us and more gains could be on the horizon.
The “danger zone” refers to a three-week period after the halving, historically linked to price volatility below a particular range.
Rekt Capital, a popular crypto analyst, noted in a May 6 post that while the danger zone might technically last until the end of the week, the expected impact on price has already occurred.
In his words: “Time-wise the post-Halving’ Danger Zone’ will continue for the remainder of this week, to see out its third final week in this post-Halving window. However, price-wise the anticipated effect has already occurred.”
He compared this cycle to the 2016 bull run, where Bitcoin experienced an 11% drop 21 days after the halving, signalling a reversal. In this cycle, Bitcoin saw a 6% drop below its range 15 days after the halving, followed by a strong recovery.
“History did repeat because in this cycle Bitcoin produced a -6% downside wick below its respective Range Low in the 15 days after the Halving. Bitcoin has since rebounded strongly to the upside… The Bitcoin Post-Halving’ Danger Zone’ is over.”
noted Rekt Capital in a May 6 X post:
Another analyst, Willy Woo, believes that Bitcoin could see higher prices based on the volume-weighted average price (VWAP), indicating a potential for a significant price increase.
He observed a bullish divergence, suggesting that there is plenty of room for further price gains.
Woo wrote in a May 6 X post:
“Seems like a good setup for BTC to reach escape velocity. Bull divergence with lots of room to run.”
Outflows from 11 United States spot Bitcoin exchange-traded funds (ETFs) have also contributed to Bitcoin’s recent correction. These ETFs saw nearly $900 million in net outflows over the past week, the highest since their launch, according to data from Dune.
Moreover, data suggests that long-term holders (LTH) at the $70,000 price have stopped selling to new investors. This could signal the start of a new phase of active accumulation, as highlighted in a May 6 post by CryptoQuant author Axel Adler Jr.
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