Bitcoin is in an exciting phase known as price discovery, a period where buyers and sellers determine the fair market price of an asset as it reaches new highs. Times like this can shape its future direction.
What Is Price Discovery?
Price discovery begins when Bitcoin moves beyond its previous all-time high, as it has done recently. For nearly a month, Bitcoin has traded above its earlier peak, signaling a new phase in its market cycle. But what does this mean for the price?
In earlier cycles, Bitcoin has seen substantial gains during this stage. For example, during the 2017 bull market, Bitcoin rose by 1,600%, and in 2021, it climbed another 245%. Even if Bitcoin achieves just half the increase from the 2021 cycle, it could potentially reach $150,000, according to trader and analyst Daan Crypto Trades.
#Bitcoin Has begun its price discovery phase for this cycle.
In 2017, it went up +1600% from that point.
In 2021, it went up +245%.Even if we’d do half of the 2021 move, that would still put price at ~$150K.
What is your estimate? pic.twitter.com/EgvcRlrrTS
— Daan Crypto Trades (@DaanCrypto) December 1, 2024
Traders Are Watching for the Next Move
As Bitcoin hovers just above $96,000, some analysts believe we could be on the verge of an even bigger move. Crypto Jelle, another trader closely following Bitcoin’s trends, describes the market as sitting in a “6-figure waiting room.” He expects one more slight dip, or “higher low,” before Bitcoin pushes into six-figure territory.
Monthly breakout, confirmed – price close to breaking 6 figures.
Remember those who mocked us for staying bullish at $50,000. pic.twitter.com/p89AdbWDAo
— Jelle (@CryptoJelleNL) December 2, 2024
Crypto Jelle also hints at a possible acceleration in Bitcoin’s price once the breakout begins, adding fuel to speculation that this price discovery phase could pave the way for dramatic growth.
What Could Happen Next?
Price discovery might sound like a technical term, but it’s essentially the market’s way of finding the right price for Bitcoin as demand increases. When Bitcoin reaches new highs, it often attracts more interest, leading to higher trading activity. Such increased participation can push prices even further upward, as history has shown in previous market cycles.
While no one can predict the exact numbers, traders are closely monitoring the trends, and some are optimistic about Bitcoin entering the “six-figure era” soon.
How Should You Approach This?
If you’re thinking about buying Bitcoin, it’s helpful to understand where the market stands. Price discovery phases are often accompanied by increased volatility, meaning prices can swing up or down more than usual.
Keep following us for the latest on Bitcoin, here at HowToBuyBitcoin.org!