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BTC Bitcoin rebounded strongly by nearly 30% in August, but the historical bottom pattern may face variables.
Bitcoin experienced a strong rebound in August, with an increase of nearly 30%. Although some views believe that the bear market is over, some voices point out that the world's largest crypto asset still risks a devastating plunge.
Evolution of the Deep Bottom Pattern
Alphractal founder Joao Wedson said that Bitcoin's "Balanced Price" is currently around $38,400, but historical trends do not necessarily mean that prices must return to that level.
Historically, the "balanced price" indicator has been very effective in identifying long-term bottoms of crypto assets. However, the cumulative time between the main intersection of this indicator and the price range has continued to lengthen, going through 732 days, 1,120 days, and 1,200 days, respectively, to the current 1,420 days. In the current cycle, Bitcoin has lasted approximately 1,400 days since its last interaction with the indicator. At the same time, the length of time that bitcoin prices fall below this indicator is also steadily shortening. In the early cycle, prices stayed below this for several weeks; then shortened to about 20 days; in 2022, assets stayed below this range for less than a day.
"Equilibrium prices" form a valuation range by using the long-term spending footprints of early holders to adjust Bitcoin's overall market cost base. Historically, this range has usually occurred during periods of extreme panic selling. Although this does not mean that the price will inevitably return to $38,000, Wedson's observation raises another possibility: Bitcoin may break historical rules and never return to the region. However, if the historical pattern repeats, the $40,000 region may still serve as a potential selling target supported by on-chain data.
At the same time, Bitcoin investors are increasingly confident that the market will bottom out. Wedson found that a "very bullish" sentiment currently dominates social media. This belief is much stronger than the uncertainty at the bottom of late 2022 and early 2023. However, this broad optimism can itself pose risks, especially if bullish traders are caught off guard by another sharp decline. In this case, the forced liquidation of long positions could trigger a new wave of selling.
Faster path to new historical highs
Another trader predicts that the crypto asset will hit a new historical high in the fourth quarter of next year and believes that its price may exceed $126,000 by November 2027. Killas pointed out that Bitcoin's market cycle is shrinking, allowing it to hit record highs faster in each cycle. Based solely on cycle estimates for 2022, he believes that Bitcoin should establish a new historical high by February 2028 at the latest.
However, the trader claimed that the current cycle was running faster because the cycle bottomed out about three to four months earlier, which could push the timetable forward further.
