Analysis: Bitcoin’s Smaller Drawdown Breaks From Past Four-Year Cycles, Lowering Odds of Another Sharp Drop
Summary
- Glassnode said Bitcoin has fallen less than it did in the previous three bear markets, suggesting the traditional four-year cycle theory is not holding in the current market.
- The firm said Bitcoin has continued to rebound after falling about 30% from its peak, indicating the price correction has been limited.
- Glassnode said the odds of a delayed plunge to levels seen in past bear markets are decreasing over time, though the possibility of further declines has not disappeared entirely.
Forecast Trend Report by Period
An analysis shows Bitcoin (BTC) has posted a smaller decline than in past bear markets, suggesting the traditional four-year cycle theory is not holding in the current market.
On September 23, on-chain analytics firm Glassnode said Bitcoin’s recent price action stands in clear contrast to the previous three bear markets. In earlier downturns, declines at a comparable point were more than twice as deep as they are now, and the market was only weeks away from a bottom.
This time, by contrast, Bitcoin has continued to rebound after falling about 30% from its peak. That means the price correction has been relatively limited compared with past cycles.
Glassnode said the likelihood of Bitcoin belatedly plunging to levels seen in past bear markets is decreasing as time passes.
Still, the analysis compares current price action with earlier market cycles and does not mean the possibility of further declines has disappeared entirely.
