The positive end of 2024 for Bitcoin

As 2024 draws to a close, Bitcoin investors are looking forward to the final quarter of the year, traditionally known for positive price action. With many speculating that a bullish rally may be on the horizon, let’s look at historical data, analyze trends and weigh the possibilities of what BTC price action could look like by the end of this year.

Historical performance of Bitcoin in Q4

Looking at the past decade on the heat map of monthly returns, Q4 has frequently delivered impressive gains for Bitcoin. The data shows that BTC often ends the year strong, as evidenced by three consecutive green months in 2023. Not every year follows this trend, however, 2021 and 2022 were less favorable, with Bitcoin ending the year on a more bearish note. However, years like 2020 and 2015 to 2017 saw huge price increases, highlighting the potential for a bullish finish to Q4.

Figure 1: Q4 performance was historically strong for Bitcoin. View the live chart 🔍

Analysis of potential Q4 2024 results based on historical data

To better understand the potential outcomes for Q4 2024, we can compare past Q4 performance with current price action. This can give us an idea of ​​how Bitcoin might behave if historical patterns continue. The range of potential outcomes is wide, from significant gains to minor losses or even sideways price movement. Projection lines are rainbow color-coded, starting from 2023 in red to 2015 in a light purple shade.

Figure 2: Previous price action from Q4, overlaid to today.

For example, in 2017 (purple line), Bitcoin experienced significant growth, suggesting that in an optimistic scenario, Bitcoin could reach prices as high as $240,000 by the end of 2024.

However, more conservative estimates are also possible. In a more moderate quarter, Bitcoin could range between $93,000 and $110,000, while in a bearish scenario, prices could fall as low as $34,000 as seen in 2018 (blue line).

The median result based on this data seems to be around the price of $85,000. Although this is based on the year-end price in these projections, years such as 2021 (yellow line) have resulted in considerably higher prices before notable year-end pullbacks.

Is the median result a possibility?

While $85,000 in about three months may seem optimistic, we only have to look back to February of this year to see a single month in which BTC saw a 43.63% increase. We can also look at metrics like the Gold Ration Multiplier, which shows the confluence around this level as a potential target with its high accumulation level of 1.6x.

Figure 3: Gold Ratio Multiplier 1.6x Accumulation currently high at ~$85,000. View live chart 🔍

Is $240,000 even possible?

Whether Bitcoin can reach such high values ​​will depend on various factors. An increase in demand coupled with limited supply could propel Bitcoin to new all-time highs. In addition, developments such as Bitcoin ETFs, institutional investments or major geopolitical events could further boost demand. We’re also seeing a similar pattern this cycle as we’ve seen in the previous two, with a first wave of large-scale market entries before a cold spell; possibly organizing a second rally in the near future.

Figure 4: Cycle capital flows showing a similar boom-and-bust period to previous cycles. View the live chart 🔍

This is probably too ambitious, the market cap of Bitcoin has grown enormously since 2017 and we would need tens of billions of money to pour into the market. But Bitcoin is Bitcoin and nothing is off limits in this space!

Conclusion

Finally, while historical data suggests optimism for Q4, predicting the future of Bitcoin is always speculative. A third of all these projections resulted in sideways price action, with one forecasting a large-scale decline. As always, it is important for investors to remain unbiased and react to, rather than predict, Bitcoin data and price action.

For a more in-depth look at this topic, check out our recent YouTube video here:
Bitcoin Q4 – A Positive End to 2024?