Bitcoin the rally has lost momentum since June, leaving prices well above $100,000. This has emboldened some analysts who believe in bitcoin’s traditional four-year cycle, warning that a tough bear market could be looming.
However, one longer-term indicator offers a glimmer of hope for bulls: the 200-week simple moving average (SMA), currently around $54,750, which is still significantly below the 2021 BTC cycle high of around $70,000, according to data source TradingView.
Now you may be wondering why this is important. Well, that’s because previous bull markets tend to end when the 200-week SMA rises to meet or challenge the peak price of the previous cycle. This happened in late 2017 and late 2021-early 2022.
For now, given that the 200-week SMA is still well below the 2021 price peak, the historical trend suggests that Bitcoin could still be in its broader bull market phase despite the recent short-term weakness.
As exciting as this “hopium” is for the bulls, it is important to remember that it has only happened twice in Bitcoin’s relatively short decade of history and in years when institutional participation was extremely low.
Therefore, drawing definitive conclusions based solely on this data may seem limited, especially in the eyes of stock investors who rely on decades of market data to identify consistent trends.
