This is the make or break moment for bulls and bears
Two weeks ago I made the case for BTC breaking out higher. It has now done just that. Here is a quick comparison showing the past and current charts.
We can see a beautiful breakout on the daily chart which has brought BTC back up to 97k. Volume is also up which solidifies this movement. So far so good?
The Bear side
On X I have recently seen the bears posting this chart which actually does look intimidating at first. The the big flaw in my opinion is that they purposefully use the linear chart where the similarities to 2022 are exaggerated.
On the log chart this comparison doesn't look that great anymore:
That doesn't look very convincing to me! The current cycle - if one still wants to use that word - is very different to the last one and on the log chart there clearly isn't the blow off top visible. BTC has just gradually climbed to these levels and so far euphoria hasn't really set in.
A far better argument for the bear case, however, comes from the Simple Moving Average (50) that BTC has never reclaimed once the top was in. Here is a chart on X circulating (although it is much too zoomed in)
Here is a better zoomed out view:
I would argue that a big caveat with this assumptions, however, is that we do not know if the top was actually in or not. In 2020 with Covid, price did in fact drop under the line, although I guess we could treat that as an outlier. If so, BTC should not reclaim the 101-102k target which would put it over the SMA 50. Or at least it would be quickly rejected like in 2022. A reclaim and breakout to the top would definitely change the market dynamics and the idea of a 4 year cycle would have to be put to rest.
Conclusion
Should BTC sustainably reclaim 102k bears and 4 year cycle sellers will seriously freak out. There will be a lot of denial and fomo with everyone trying to get back into the market again. We will instantly hear targets of 200-500k being proclaimed on X with 2026 being the new 2025. If BTC gets rejected, Ii suppose we are actually in for some more bearish months. But from the chart we can see that it probably won't be too bad (without an euphoria top, I can't see a big drop). Maybe going back to 50-60k?
As a general reminder: Please keep in mind that none of this is official investment advice! Crypto trading entails a great deal of risk; never spend money that you can't afford to lose!
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