Bitcoin could be on the brink of a significant rally by the end of 2024, according to insights from the latest report by 10x Research. The report highlights the volatile nature of the year thus far while discussing a potential paradigm shift, driven by a confluence of factors affecting the cryptocurrency market along with seasonal patterns.
In an interview with Cointelegraph, Markus Thielen, the founder of 10x Research, emphasized the importance of the anticipated FTX payout. He noted that the proposed inflow of $5–$8 billion could trigger bullish sentiment in the market. Thielen stated:
“There’s a possibility of a melt-up in risk assets, as the Fed [United States Federal Reserve] seems to have raised the level of the S&P 500 at which they would intervene to protect investors. This signals the potential for further rate cuts — often referred to as the ‘Fed put.’ As a result, many investors are likely to reposition their portfolios in anticipation of 2025.”
Seasonal Patterns Favoring Bitcoin
Historically, Bitcoin has performed well from October to March, a trend reiterated in the 10x Research report. The document speculates that this seasonal trend could repeat itself this year, especially when considering previous market cycles from 2014, 2017, and 2021.
“While our contrarian bearish outlook since March/April was based on various factors, Bitcoin’s 2024 performance has once again followed its seasonal pattern — just as it did in 2023,” Thielen remarked.
The report outlines several external factors that could act as catalysts for Bitcoin’s end-of-year performance. Increased liquidity is anticipated to bolster bullish momentum, with macroeconomic conditions playing a significant role. Key elements such as the Federal Reserve’s interest rate decisions, inflation concerns, and dynamics related to the upcoming US elections could all influence BTC’s price.
Despite the potential for bullish catalysts, the report urges investors to remain vigilant. It highlights Bitcoin’s historical tendency for drawdowns of up to 70% in past cycles. Thielen pointed out:
“The two key levels to watch for Bitcoin are the previous cycle high of $68,330 and the 21-week moving average. Managing trades around these levels is essential for effective risk management, which may involve selling during volatile periods, even at less-than-ideal levels.”
The Rise of Gold and Its Impact
In a related development, gold has gained over 5% since September 9, reaching a new all-time high. This surge is attributed to geopolitical tensions and interest rate cuts. Crypto analysts have begun speculating on how Bitcoin’s price might respond to this significant rise in gold prices.
The Federal Reserve’s 0.5% interest rate cut on September 18 catalyzed the risk-off commodity, pushing gold to a record price of $2,629 per ounce as of September 23. This environment creates an intriguing context for Bitcoin as it seeks to establish its own bullish trajectory.
As the landscape shifts with the looming FTX payout and changing Fed policies, Bitcoin’s potential for a rally appears increasingly plausible. While seasonal patterns and macroeconomic indicators suggest a favorable outlook, the historical volatility associated with the asset calls for careful monitoring and risk management.
Investors are advised to remain aware of critical price levels and the broader market conditions that could impact their trading strategies as the end of 2024 approaches.
