Content SummaryA well-known analyst has released the latest Bitcoin (BTC) cycle spiral chart.According to his perspective, the cryptocurrency market is currently in the early stages of a bull market - it will continue for another 1
Content Summary
- A well-known analyst has released the latest Bitcoin (BTC) cycle spiral chart.
- According to his perspective, the cryptocurrency market is currently in the early stages of a bull market - it will continue for another 1.5 years.
- Each stage of the 4-year cycle is accompanied by recurring psychological states among investors.
As long as the halving of Bitcoin has an impact on BTC prices, miner activity, and investor psychology, the narrative of the Bitcoin cycle will continue to repeat. According to the author's view on the comparison of the special currency cycle, a renowned analyst has released the latest version of the spiral chart, perfectly showcasing the cyclical stages of the 4-year cycle.
The Bitcoin cycle involves BTC prices, short-term investors' on chain data, and their psychology. These recurring cycles once again prove that the expectations of cryptocurrency novices that 'this time is different' are wrong.
Three stages of each Bitcoin cycle
Famous analyst @ thermanalroot released an updated version of his Bitcoin spiral chart on Twitter on August 1st. He briefly introduced the quite complex fractal structure:
The 4-year cycle is correct! Each cycle consists of 3 stages
The idea behind this innovative graphical representation is the Bitcoin cycle hypothesis. This statement is well-known in the cryptocurrency market and is based on a halving event that occurs approximately every 4 years.
However, according to the analyst, each of Bitcoin's three historical cycles to date has been completed in three recurring cycle stages. Interestingly, @ thermanalroot andNot taking into account the first Genesis cycleHe said, 'This is not that interesting, it's a bit out of place because Bitcoin doesn't have price data in the first year.' Therefore, the three stages of each 4-year Bitcoin cycle are as follows:
- A mature bull market that lasts for about a year.This was triggered by the halving of BTC in history. On the chart, this is the first quarter (upper right corner). This stage ends with a new historical high in Bitcoin prices (ATH). At the same time, he emphasized that sometimes it may be double peaked (double highs such as 2013 and 2021), and sometimes it may be single peaked (single highs such as 2017 and possibly 2025).
- A bear market that lasts for about a year.It occurred after the frenzy and explosive peak of BTC prices. This is the second quarter of the chart (bottom right corner). On average, at this stage of the cycle, Bitcoin loses 80% of its value, and the entire downward trend ends with 2 or 3 surrender events. The vast majority of investors have lost hope here.
- The early bull market (early bull market) lasted for about 2 years.This is the left half of the chart. After experiencing a sharp decline and reaching the bottom of macro prices, the price of Bitcoin has gone through a long accumulation stage and a slow rise. During this period, Bitcoin typically rises, but the rate of increase is very slow, accompanied by multiple adjustments.
Bitcoin's 4-year spiral cycle
The Spiral Cycle of Bitcoin
BuyBitcoinWorldwide: BTC Half Countdown
According to the analyst, Bitcoin is currently in the third stage of its cycle. This stage will start around the beginning of 2023. It will last at least until the next halving. According to the latest data from BuyBitcoinWorldwide, the next halving is expected to begin on April 17, 2024.
The above chart highlights the similarity between Bitcoin cycles. These not only involve the timing and regularity of repeated stages, but also involve the profits and psychology of crypto market investors.
Firstly, @ thermanalroot colored the chart in a ratio from dark green to deep red. The former (dark green) indicates the maximum profit of market participants, while the latter indicates their maximum loss. This data is based on the STHCostBasisZ-Score indicator on the chain, which roughly describes the short-term investment situation of market participants. Their behavior best reflects the repetitive pattern of BTC price trends.
Then, the analyst also released another slightly different chart. In this version, he corresponds the continuous stages of Bitcoin's 4-year cycle to the investor psychology stage. These express the dominant emotions of market participants at each stage of the cycle.
Cryptocurrency Market Psychology/Source: bitcoinstrutagyplatform.com
Therefore, it has been proven that the similarity between Bitcoin cycles occurs not only in terms of the maximum cryptocurrency price, but perhaps more importantly, in the psychological aspects of market participants. The spiral cycle describes the changes in BTC prices caused by halving, while also capturing the prevailing sentiment that overwhelms investors.
Of course, comparing price trends with investor psychology is not very enlightening, as it has been operating in traditional financial markets for decades.
In addition, the psychological stages included in the BTC spiral chart and emphasized in the classic "Wall Street Memo: Market Cycle Psychology" areMatchof However, the key difference is that in mature traditional asset markets, cycles are more difficult to identify and typically last much longer than 4 years.
Wall Street Memo: Market Cycle Psychology/Source: financialhorse.com
Bitcoin Price Forecast: It will reach $60000 by the end of 2024
This analyst concluded his discussion with a Bitcoin price forecast for the end of 2024. In his opinion, in the next 1.5 years, BTC prices are expected to return to the ATH region of $69000. He pointed out that so far, the early stages of the bull market have caused ATH losses to recover by about 30%, from $15000 to $30000. By comparison, the remaining 70% should be made up by the end of 2024.
At the same time, he predicts that during the halving period in April 2024, the price of BTC will oscillate/fluctuate around $40000. Then, in the second half of 2024, it should hover within the range of $50000 to $60000.
Although these predictions regarding the price of Bitcoin are optimistic, the analystSuggest cautious actionAnd remind attention to events that may cause the Bitcoin cycle to deviate from the normal rhythm. According to him, the early approval of BlackRock's spot Bitcoin EFT may accelerate the upward phase.
On the other hand, he mentioned concerns about the continued global economic recession. If this happens, it will definitely affect the cycle of Bitcoin and the entire cryptocurrency market. However, the consequences will be difficult to predict:
Since Bitcoin has never been in an economic recession (without a history of recession), it is difficult to predict how it will respond. If it remains correlated with the S&P 500 index, a recession may temporarily cause market turbulence
Disclaimer:This price analysis article is for reference only and does not constitute any investment advice! Before making any financial decisions, always conduct your own research and consult with professionals.
Planning and production
Original text:JakubDziadkowiec
Translation/organization: 9iMxxx | Release: NFTGamer
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