Bull or Bear, Bitcoin’s Halving Volatility is A Golden Opportunity for Traders

Bull or Bear, Bitcoin's Halving Volatility is A Golden Opportunity for Traders

Volatility is one of the biggest concerns for the Bitcoin-curious. With the third halving on the way, Bitcoin volatility only increases. Don’t worry, no matter which way the price will go, traders can always benefit from the price swing with the right trading tool. 

Recently, the Bitcoin world has welcomed some great news. Followed the significant crash in March which slashed Bitcoin’s price into a half, Bitcoin steadily retook the lost ground in April. Then it rallied strongly in the past week and even surpassed $10,000 on May 7. 

The rally has many people wonder: is Bitcoin really going to skyrocket after the halving as many critics predict? And could the third halving be a step towards PlanB’s prediction that Bitcoin will hit $288K by 2024?

Amid the bullish-craze, some are not so positive about Bitcoin’s short-term price. 

“With the bitcoin halving fast approaching, we believe a short-term pullback is highly likely immediately post-halving, as traders begin taking profits.” Lennard Neo, head of research at Singapore-based institutional-grade bitcoin index fund Stack, has warned about the potential price drop after the halving


If we really look into the data, we will find in 2012 and 2016, Bitcoin’s price didn’t witness a rise immediately, rather, the price corrected after the halving, and it wasn’t until over 8 months later that we saw a boost in price. 

According to the BTC Put/Call Ratio data of Skew of the past 30 days, the open interest ratio rose from 0.59 to 0.81. This could be an indication of the bearish mood among investors who took action to hedge the downside risk in Bitcoin’s price. 

Bitcoin put/call ratio – Source: skew

The most significant result of the halving is the cutting of issuance, which at the same time bring the minging rewards to a half. Facing the prospect of doubling their mining cost, miners with less efficient machines will be forced to upgrade their machines, so many will choose to sell their Bitcoin holdings to make ends meet, which might result in a drop in Bitcoin’s price. 

Another big problem for Bitcoin is the shadowy future of the economy. Although some countries have started to ease the coronavirus lockdown restrictions, many people hoping to go back to work might find themselves nowhere to go back to. 

According to the U.S. Department of Labor, another 3.2 million Americans filed initial jobless claims in the past week. Now 1 in 5 American workers have filed for first-time unemployment benefits since mid-March. If a considerable turnabout doesn’t appear soon, certainly some Bitcoin holders will cash in their holdings to cover the bills, which will increase the supply of Bitcoin. 

In the long run, Bitcoin’s price is likely to increase due to its capped supply and widening adoption in various countries and regions, but a rapid surge might not happen right away as Bitcoin is expecting more volatile moves in the short-term.

Make Good Use of the Volatility with Leverage Trading

Although a price correction could be bad news for some Bitcoin holders, we can make the best of the situation using leverage trading.  

In leverage trading, every fluctuation is an opportunity to generate profit. You can open a Sell/Down position or a Buy/Up position with leverage. If the market goes as you predicted, your investment will generate exciting returns. Furthermore, leverage trading allows you to open a position X times more than your initial investment.  

With the 100X leverage provided by Bexplus, you can open a 10 BTC position with only 0.1 BTC as margin. When your position gains a 10% profit, you will make 1 BTC with 0.1 BTC as initial investment, whereas without leverage, your profit will only be 0.01 BTC. 

Registered in Saint Vincent and the Grenadines, Bexplus is a leading crypto derivatives trading platform offering 100x leverage futures trading on BTC, ETH, LTC, EOS, XRP and etc. Without KYC requirements, you only need to verify your email then you could start trading within a few minutes. Its minimalist interface, demo trading mode, and 24/7 customer support are some of the features that set it apart from other platforms, making it an ideal choice for both beginners and seasoned traders. 

Bexplus is now offering a 100% deposit bonus to users to help them increase the chances of making more profits. Plus, active users are now entitled to get 10% off of their transaction fees. If you are willing to take risks and are ambitious to earn more BTC, Bexplus could just be the right place for you. 

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