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To me, it's more important to observe when supply is being absorbed by the market, i.e. demand is overtaking supply, than to know the reasoning behind it.
To me, it's more important to observe when supply is being absorbed by the market, i.e. demand is overtaking supply, than to know the reasoning behind it.
actually i'd say it is also important to know the reason behind every move, whether it is a rise or a drop if you want to have a better understanding of the market and also if you want to speculate it better.
for instance if the reason for the rise is halving hype[1] then you can be sure that that kind of rise is not going to last long and it will fall down[2].
How would you ever know the reason for the rise is halving hype? That's impossible. You don't actually know any of that, and your "understanding of the market" may be completely false. That's the point: we can study price and volume to make conclusions about underlying supply and demand. We logically cannot make conclusions about why demand might be increasing.
There could be endless reasons why anyone is buying BTC: general long term investment, strong fundamentals, increasing adoption, economic hedging, cross-border transactions, avoiding censorship, "halving hype" etc. It would be ridiculous to assume at any point that everyone is buying because of the halving. There's literally no evidence for that. It's empty speculation.
The halving is on the back of everyone's mind when they buy bitcoin and it influences their decision one way or another.
Someone that needs bitcoin for a specific task like moving their wealth from A to B with the intention of selling once they have arrived to B, before selling, they may look if the halving is around the corner, and if it's near they may decide to hold some of it. "Hell, maybe it pumps...". Just a practical example. My point is that no matter what the halving is a constant bullish pressure.
Another stat to consider is when the market bottomed relative to the next halving, and it's around a year apart. So you could say that when bitcoin has reached a ridiculously low price after a bubble and the halving is a year away, people that is on fence about buying start getting nervous and start buying, then the rest realize we already bottomed and the next rally begins. Buyish news (like say, Bakkt) just put fuel in the rocket to accelerate things.
