Bitcoin Bear Market Declared Over, With Upside Target of $215,000
New analysis suggests the cryptocurrency’s downturn has concluded, projecting significant gains.
A report released Wednesday by BIT Research asserts that Bitcoin’s bear market has ended, presenting an optimistic scenario for the current cycle that could see the price reach between $185,000 and $215,000. The leading cryptocurrency is currently trading above $83,000 and is poised to conclude its third consecutive month in positive territory, with quarterly gains reaching 42%.
The firm claims to have accurately predicted the cycle’s low in late July. At that time, Bitcoin had met a downside target derived from Elliott Wave analysis and successfully held above the $62,900 level.
Technical Indicators Signal Bullish Turn
Key technical indicators have also pointed towards a bullish reversal. The weekly Relative Strength Index (RSI), a measure of price momentum, ceased its decline in June and July even as Bitcoin’s price hit new lows. The report draws a parallel between this divergence and the market bottom observed in 2022. Subsequently, Bitcoin surpassed its 21-week moving average at $69,272 and reclaimed the $70,000 mark. It is now trading around $83,000, exceeding its March 2024 high of $73,084.
Cost Basis and Macro Factors Support Rally
BIT’s analysis also leaned on cost basis data. The “True Market Mean,” which estimates the average price at which holders acquired their Bitcoin, stands at $76,897. This indicates that both typical long-term holders and recent spot ETF buyers are now in profit, a development the analysts believe removes a significant source of selling pressure.
Furthermore, the report considers the escalating US federal debt, which has now surpassed $40 trillion. Rising Treasury yields, driven by concerns over government finances, could potentially drive capital towards both gold and Bitcoin as safe-haven assets.
Debt Model and Potential Headwinds
BIT’s debt model provides a reference valuation for Bitcoin near $105,000. However, the primary headwind identified is a strengthening US dollar, coupled with market expectations of further Federal Reserve interest rate hikes and ongoing geopolitical tensions in the Strait of Hormuz. Despite these challenges, the firm does not anticipate them derailing the current rally, noting that historical dollar strength has impacted gold more severely than Bitcoin.
Recent Performance and ETF Inflows
The original cryptocurrency has been trading within the $83,000 to $85,000 range since facing resistance near $87,000 last week. As of this writing, Bitcoin was trading just above $83,000, representing a dip of over 4% in the past seven days. Nevertheless, this price point signifies a nearly 10% increase over two weeks and a more than 7% rise compared to 30 days ago. Data from Coinglass shows the third quarter closing with gains of 42.22%, marking the best quarterly performance since Q4 2024 and the strongest Q3 since 2017.
ETF flows have also shown improvement. Spot Bitcoin ETFs recorded net inflows of $2.8 billion in September alone, bringing cumulative inflows to $57.6 billion and total net assets under management to approximately $108 billion.
Future Projections and Market Dynamics
In previous cycles, Bitcoin has historically climbed at least 85% above the average holder’s cost basis, which is currently estimated at around $142,000. BIT’s analysts clarified that this level serves as a reference point for tracking a bull market rather than a minimum target or a definitive peak. While prices have historically continued to rise after crossing this threshold, they cautioned that past performance is not indicative of future results.
During the last cycle, Bitcoin reached the 85% mark near $73,000 in March 2024 and subsequently peaked at $126,000, approximately 1.7 times higher. If this multiple were to shrink to between 1.3 and 1.5 times on the current $142,000 base, it would translate to a price range of $185,000 to $215,000.
The timing of such a surge remains uncertain. The previous cycle took roughly 19 months to advance from the 85% level to its peak. Applying a similar pattern could place Bitcoin at $200,000 around 2028 or 2029, though the analysts emphasized the speculative nature of such pattern matching and the inherent uncertainty in timing. They also noted that the asset currently appears “stretched” after a rapid ascent, suggesting that a period of consolidation or a more significant pullback remains a possibility in the near term.
