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Bitcoin's price began its bear market 126 days ago and last week it reached a 52% drawdown from its all-time high of $126,000. Is this enough to conclude that the cyclical bear market is over?
👉In a cyclical bear market for Bitcoin, there are two aspects to consider:
The price aspect, the drawdown, and the bear market structure;
⚠️The time aspect, meaning the total duration of the bear market before it resumes a cyclical bullish phase.
Naturally, the market doesn't go directly from a falling phase to a new bullish phase. Bitcoin's history consistently shows a long accumulation phase lasting several months, essentially building a technical foundation for a healthy upward move.
Have we already entered this sideways accumulation phase? It's possible from the perspective of the drawdown and the three-wave structure of the decline, but it's still unlikely in terms of time, as 126 days is still a relatively short period.
Dollar Cost Averaging (DCA) involves gradually investing a fixed sum at regular intervals, regardless of the price. This approach smooths the initial investment, reduces the impact of volatility, and, most importantly, avoids emotional decisions, which are particularly common during bear markets.
Applied to Bitcoin, DCA is most effective during advanced drawdown phases, when pessimism prevails and long-term indicators have entered oversold territory. Historically, areas of 50% to 70% drawdown from the previous peak have often been very favorable accumulation zones for patient investors.
From a quantitative perspective, logarithmic regression and price quantile models currently place the $50,000/$60,000 zone within the lower bands of relative valuation, consistent with a cyclical undervaluation phase. These levels also correspond to major support levels formed during the previous expansion phase, reinforcing their technical credibility.
There is no evidence to suggest that last week's low of $60,000 is the final bottom of the bear market, and it is entirely possible that this level will be revisited in the coming months. However, most long-term BTC forecasting models, such as the power law-based quantile model, describe the $50,000/$60,000 zone as an area where a dollar-cost averaging (DCA) strategy has a high probability of being successful in the long run.
Finally, the time frame remains key. Bitcoin bear markets have rarely been short-lived. They are most often characterized by alternating technical rebounds, frustrating sideways phases, and late capitulations, and on average, they have lasted 12 months, which brings us to September/October. It is precisely in this context of patience that Dollar-Cost Averaging (DCA) becomes so relevant, allowing investors to gain exposure without trying to anticipate the perfect low in terms of price and time.
In conclusion, the $50,000 to $60,000 range does not guarantee that the bear market is over, but it represents a coherent zone for gradual accumulation for medium- and long-term investors.
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