Historically, Bitcoin has exhibited 4-year cycles, largely related to the halving (the halving of the Bitcoin mining reward), which occurs approximately every 4 years. This event tends to reduce the supply of new bitcoins on the market, which in previous cycles has influenced the price, especially in the year following the halving.
December in Previous Cycles:
2013 (Bull Cycle): In December 2013, Bitcoin reached an all-time high around $1,000 before entering a prolonged bear market. It was a month of great excitement, but also the start of a multi-month correction.
2017 (Bull Cycle): Four years later, in December 2017, Bitcoin reached another all-time high of close to $20,000. This was the climax of the bull cycle that then gave way to a severe correction, followed by a bear market in 2018.
2021 (Bull Cycle): Although not in December, Bitcoin reached its all-time high of around $69,000 in November 2021. However, in December it remained at a high level before entering the downtrend that continued into 2022.
What Could Happen This December?
Bullish Scenario: If the market follows the historical pattern, December could bring bullish momentum, though perhaps not as pronounced as previous peaks. Rumors about the possible approval of a Bitcoin ETF in the United States, more Trump-friendly regulation, and renewed confidence from institutional investors are factors that could push the price higher.
Correction or Consolidation Scenario: The difference this year is that we are in a recovery phase and not at the exact point of the bullish cycle of highs. This suggests that we could see a consolidation rather than a big rally, although Bitcoin has shown surprises in the past.
Is It a Good Time to Buy?
Pros: If you have a long-term view, buying on a dip can be advantageous, especially if you believe the upcoming halving in 2024 will boost the price for years to come. Buying when the market is down is often an effective strategy to accumulate at lower prices.
Con: However, the market is still volatile, and there is always a risk of a further correction. If you prefer less risk, you could wait for a clear signal of recovery, such as a break of key resistances.
Conclusion
If you are willing to hold your investment for the long term and endure volatility, December could be a good opportunity to buy at relatively low prices. However, it is always prudent to diversify your inputs (do DCA, periodic purchases) to reduce the risk of buying at a point that may still fall. History suggests that Bitcoin has the potential to grow, especially in the year following the halving, but it is also important to consider the current risks and not rush into things.
