Bitcoin: Pain on the Menu

By johnwege | johnwege | 4 Sep 2024

Good times don’t last forever.

Overall 2024 has been one of the most bullish years for Bitcoin in recent history. Beginning the year with the launch of the Bitcoin spot ETFs. Then the BTC halving occurred in April, and it has become a key topic in the US Presidential election. The price action has been just as bullish. Beginning the year at nearly $43k, and soaring to a new all-time high of $73k before now settling in a range near $60k.

This year was the first time in Bitcoin’s history that it had made a new all-time high before the Halving even took place. It appeared that the market was way ahead of schedule and this caused investors to be in a frenzy.

“If Bitcoin had already reached $73k before the halving even occurred, just how high could it go this cycle?”

The market started looking ahead and began making outlandish predictions. It was an everyday occurrence to see a crypto expert predicting that Bitcoin could reach several hundreds of thousands of dollars this cycle. Some were even predicting a price as high as $500k. Further out on the timeline, there were even those saying that Bitcoin could reach $1 million in a handful of years.

All of those predictions are possible, and I would argue will eventually happen on a long enough timeframe. But once again the market seems to be getting ahead of itself.

It is almost like Bitcoin has a mind of its own and loves to be a contrarian. Just when everyone thinks it will be smooth sailing from here on out. That is the moment that Bitcoin loves to break your heart. The same is also true when people are betting that Bitcoin’s price will drop much further. Only for it to become parabolic and soar upwards.

The first few months of 2024 were incredibly bullish for Bitcoin, but since it reached $73k before the halving the truth is that Bitcoin has been moving down and sideways. Many were hoping or even expecting that once summer came to an end; that was the time that Bitcoin would finally begin to move up in price again.

But we have entered the month of September and there is once again something vitally important that many Bitcoiners are overlooking.

Throughout Bitcoin’s short history, September has always been one of its worst-performing months. Since 2013 there have been 7 red months compared to only 3 green months in September. But even those green months were only just a few percentage point increases.

Bitcoin is a worldwide asset, but the truth is that the US is still the largest financial powerhouse. This upcoming Presidential election brings a lot of uncertainty to the US market, which also brings uncertainty to Bitcoin.

The harsh reality is that Bitcoin could be setting itself up for a steep pullback in price and you need to be prepared for that possible outcome.

A Bitcoin price pullback would actually be a gift.

When in doubt just zoom out. Yes, it is true that BTC’s price could drop dramatically in September and scare the market. But if you have been in the research and truly understand Bitcoin’s value, then it won’t phase you at all. Bitcoin is a long-term play, and those who plan accordingly will be the most successful.

However, every cycle there are a few moments when we see price drops that if taken advantage of can completely transform your portfolio. This possible scenario could end up being one of those moments. To ensure your success be sure to have some extra cash on the side to take advantage of price drips.

But most importantly, it is a time to protect yourself. Do not take on any unnecessary risk. Trading with leverage or taking loans against your crypto is one of the quickest things that can liquidate you during these times. Often times the people who are the most successful in crypto are simply those who survive the ups and downs without making any self-inflicted portfolio wounds.

I fully believe that this cycle we will see Bitcoin do some really incredible things, but it’s always important to never get too far ahead of yourself in this market.