Bitcoin Market Cycles Using Fib Extensions in Time
The charts used here are very wide, right click and open image in new tab:
Background. The last two Bitcoin market cycles featured:
- Clear HTF downtrend: LHs and LLs
- A definitive HH signifying a major shift to bullish market structure
- A gradual uptrend that built momentum until it became a mega bull market, reaching ridiculous highs (1200, 20k)
While halvings are a major upward driver for Bitcoin price over the long term, Bitcoin market cycles themselves do not repeat every four years. Thus, using bar patterns or "fractals" around the last two halvings to extrapolate what happens now is incorrect.
The second market cycle took considerably more time to play out than the first. Actually, no matter how you measure it, the two cycles very accurately respect major Fibonacci extensions in time.
If you measure the uptrends, defined as the period starting with the major HH and ending with the peak, the duration of the second cycle was precisely 1.272x the duration of the first, off by only one bar.
2015 HH to 2017 peak = 1.272 x 2012 HH to 2013 peak
A 1.272x extension of the 2015 HH to 2017 peak would imply that the next bull run peak is to occur about 1134 days after we get our cyclic HH - and we may be close. A break of 10.6k during this rally into the 2020 halving would imply a next bull run peak in June-July 2023.
Note: I do not consider the reclaim of 6k in May 2019 to be a cyclic HH because the current downtrend should be *longer* than the last downtrend in 2014. The downtrend has certainly continued since 13.9k, so I consider that rally to be a blip in the continuing bear market.
But what about if you measure Bitcoin market cycles from peak to peak, e.g. 32 to 1200, 1200 to 20k? Turns out they respect a 1.618x extension. Applying a 1.618 extension of the duration between the 1200 and 20k peaks implies a next bull run peak in June-July 2024.
June-July 2023 and June-July 2024 can be interpreted as *bounds* (in time) for the next bull run peak, since the cyclic HH has not happened yet and the soonest it could happen is now.
A continued downtrend until a cyclic HH in May 2021 would cause the two projections to converge on the same date of June-July 2024 (but this is unlikely imo). A cyclic HH occurring after that would imply that June 2024 is the lower bound (in time) for the next bull run peak.
Lastly, this projection continues the pattern of decreasing but still positive slope of the uptrend following previous halvings, assuming a max price of between 50k and 300k. Thus, this fib-based projection does not violate the precedent set by the previous halvings.
Final caveat. Ultimately, I'm using only two data points: the lengths of the last two Bitcoin market cycles. That they are fib extensions of each other could always just be coincidence. But we'll see in 3-4 years if I'm right.
Thanks for reading!
Background. The last two Bitcoin market cycles featured:
- Clear HTF downtrend: LHs and LLs
- A definitive HH signifying a major shift to bullish market structure
- A gradual uptrend that built momentum until it became a mega bull market, reaching ridiculous highs (1200, 20k)
While halvings are a major upward driver for Bitcoin price over the long term, Bitcoin market cycles themselves do not repeat every four years. Thus, using bar patterns or "fractals" around the last two halvings to extrapolate what happens now is incorrect.
The second market cycle took considerably more time to play out than the first. Actually, no matter how you measure it, the two cycles very accurately respect major Fibonacci extensions in time.
If you measure the uptrends, defined as the period starting with the major HH and ending with the peak, the duration of the second cycle was precisely 1.272x the duration of the first, off by only one bar.
2015 HH to 2017 peak = 1.272 x 2012 HH to 2013 peak
A 1.272x extension of the 2015 HH to 2017 peak would imply that the next bull run peak is to occur about 1134 days after we get our cyclic HH - and we may be close. A break of 10.6k during this rally into the 2020 halving would imply a next bull run peak in June-July 2023.
Note: I do not consider the reclaim of 6k in May 2019 to be a cyclic HH because the current downtrend should be *longer* than the last downtrend in 2014. The downtrend has certainly continued since 13.9k, so I consider that rally to be a blip in the continuing bear market.
But what about if you measure Bitcoin market cycles from peak to peak, e.g. 32 to 1200, 1200 to 20k? Turns out they respect a 1.618x extension. Applying a 1.618 extension of the duration between the 1200 and 20k peaks implies a next bull run peak in June-July 2024.
June-July 2023 and June-July 2024 can be interpreted as *bounds* (in time) for the next bull run peak, since the cyclic HH has not happened yet and the soonest it could happen is now.
A continued downtrend until a cyclic HH in May 2021 would cause the two projections to converge on the same date of June-July 2024 (but this is unlikely imo). A cyclic HH occurring after that would imply that June 2024 is the lower bound (in time) for the next bull run peak.
Lastly, this projection continues the pattern of decreasing but still positive slope of the uptrend following previous halvings, assuming a max price of between 50k and 300k. Thus, this fib-based projection does not violate the precedent set by the previous halvings.
Final caveat. Ultimately, I'm using only two data points: the lengths of the last two Bitcoin market cycles. That they are fib extensions of each other could always just be coincidence. But we'll see in 3-4 years if I'm right.
Thanks for reading!
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