The market for the first cryptocurrency is showing a frightening similarity to the dynamics of 2022. The current recovery from the June bottom, in my observation, increasingly resembles a classic bull trap, which will be followed by a final capitulation and a sharp trend reversal.
Analyzing the price structure, I see an almost perfect repetition of the scenario from two years ago: the formation of a local bottom in June, a subsequent bounce that retail traders mistakenly take as salvation, and finally, a decisive drop with mass liquidation of long positions. The fractal similarity is particularly striking: the RSI divergence, the false recovery, and the test of the 200-day moving average — all these elements are present now as well.
The 2022 Fractal: A Repeat of the Past?
In 2022, after the June bottom, Bitcoin lost another approximately 28% in November-December. If the fractal is confirmed, we can expect a similar final collapse. I consider the $65,000 level to be the key zone to watch. If a consolidation above this mark does not occur, the current upward momentum will likely exhaust itself, and the market will begin to form a new bottom in the third or fourth quarter.
On-Chain Data: Signals of a Bottom or Continuation?
However, it is not so clear-cut. On-chain metrics are sending contradictory signals. The Spent Output Profit Ratio (SOPR) has fallen to a 20-month low of -0.35 — a level last seen in December 2022 after the FTX collapse. Historically, such values have accurately indicated reversal zones in 2015 and 2019.
Moreover, the current price of Bitcoin is only 16% above the realized price. Analysis of previous cycles shows that when so close to this zone, returns averaged 41% after six months and 81% after a year. This suggests that the current level could be an attractive entry point for long-term investors, despite short-term risks.
My conclusion: the market is at a critical point. On one hand, there is the frightening price fractal of 2022; on the other, fundamental on-chain indicators signaling a potential bottom. I lean towards a scenario of a short-term correction to $50,000–$52,000, followed by the formation of a true bottom, but an immediate reversal based on historical SOPR data cannot be ruled out either. Investors should prepare for volatility and clearly define their entry and exit levels.