Bitcoin (CRYPTO: BTC) is trading below the key $78,000 level as analysts debate whether the latest rally is a recovery, or another classic bear market trap.
Why Analysts Say This Isn’t “Different”
In a May 18 podcast, Benjamin Cowen argued that bear markets rarely move in straight lines. Instead, they often produce sharp countertrend rallies that make bulls feel right for months before the market eventually breaks lower again.
The comparison many traders are making is to Bitcoin’s prior bear cycles:
- In 2018, Bitcoin bottomed in February, rallied for months and didn’t break those lows until June.
- In 2022, Bitcoin also spent roughly 21 weeks before making a new cycle low.
- Historical bear markets have often taken 19 to 25 weeks before the next major breakdown occurs.
According to the analysis, the current cycle has only been underway for roughly 14 weeks, suggesting the timeline still fits prior bear market structures.
Key Levels Traders Are Watching
Cowen highlighted several technical levels acting as major resistance zones:
- The 200-day moving average, which capped rallies in both 2018 and 2022 bear markets
- The 0.382 Fibonacci retracement, which historically marked relief rally tops before further downside
- Potential resistance near $85,000, which aligns with the current 0.382 retracement level
The broader thesis suggests Bitcoin could still rally toward those levels before another major decline later in 2026.
Why June Matters
The analyst called June a historically important turning point for Bitcoin cycles as it marked a major low in 2018 and produced a cycle low in 2022.
The view is that Bitcoin could either set a short-term high in June before another leg lower or establish a temporary bottom before weakness returns into October
The Bigger Bear Case
The analysis argues Bitcoin’s current structure resembles both the 2018 bear market, when Bitcoin repeatedly bounced off $6,000 before collapsing lower and the 2019 cycle, when rallies eventually failed amid tighter monetary conditions
One major metric being watched is Bitcoin’s realized and balance price models wherein realized price sits near $54,000 and balance price sits near $39,000. Historically, Bitcoin has traded below both levels during major bear markets.
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