Analyst: Sentiment From The Fed Makes Bitcoin Price Stagnant After Halving

Illustration. (Photo: Doc. Antara)

JAKARTA - crypto analyst Tokocrypto Fyqieh Fachrur assesses that there is no strong signal from the US Central Bank (The Fed) to lower interest rates as the main reason Bitcoin (BTC) prices tend to stagnate post-halving.

Seeing the increase in post-halving BTC prices in 2020, at that time the Fed had a fairly loose monetary policy with relatively low interest rates.

"Bitcoin price segmentation after halving can be considered a natural phenomenon. Many expect a significant price increase after diving, even though the effects of this diving are actually felt in the next 2-4 months," said Fyqieh in an official statement in Jakarta, quoted from Antara, Friday, April 26.

Fyqieh said, for those who are still doubtful or unsure about the direction of the BTC price movement, they can choose to use the Dollar Cost Average (DCA) technique, given the recent uncertainty in the market that BTC could potentially be bullish or bearish.

He estimates that the maximum price of BTC that BTC still has the opportunity to achieve by the end of this year is around US$100,000 or around Rp1.6 billion. However, this achievement also relies on market sentiment and potential large demand from institutions.

Fyqieh explained, a week after half-having on April 20, BTC was still under pressure and negative sentiment.

In addition to waiting for the Fed's decision, several other factors contributed to the negative performance, including anticipating quarterly earnings reports of technology companies in the US to Israeli-Iran conflicts.

BTC's negative performance this week was related to the correction of the US stock market, the increasing crisis in the Middle East, and reduced confidence in China's economy.

In addition, the funding rate turned negative for the first time this year, just before the recent halling event.

"The negative funding level shows that market sentiment has changed towards bearish when the short position was bigger than the long position," said Fyqieh.

Furthermore, this year's halving cycle will be slightly different than the previous events. So far, there have been four HAVING BTCs, on April 20, previously on May 11, 2020, July 9, 2016, and November 28, 2012.

This event resulted in a 50 percent reduction in BTC mining rewards, from 6.25 BTC to 3.125 BTC.

As a result, the number of BTC circulating is increasingly scarce, causing a surge in demand among investors. This is mainly due to the limited supply of BTC, with a maximum of 21 million coins circulating forever.

"The movement of the Bitcoin price will be a little different after this year's haaving, as BTC has seen a sizeable spike, and even hit a new record high before the haaving itself. Therefore, the entire price cycle that usually surrounds these events seems to be more compressed," he also said.