The bitcoin market is showing a frightening similarity to the dynamics of 2022. The current recovery from the June bottom, in my assessment, is forming one of the largest "bull traps" of the current cycle. This rally will most likely be followed by a sharp reversal downward and a final capitulation of holders.
Bitcoin's price trajectory almost mirrors the 2022 pattern: the formation of a June bottom, a subsequent bounce that retail investors mistakenly take as a rescue, and finally, a decisive drop with a real capitulation. BTC is now retesting the 200-day moving average. Retail is actively opening long positions, euphoria is building—but, in my observation, this rally will be followed by a sharp reversal.
Fractal Similarity and Key Levels
I highlight several key fractal coincidences: the June bottom, a false recovery, RSI divergence, and a subsequent downward surge before the real reversal. In 2022, after the June low, bitcoin lost about another 28% in November-December. If the fractal repeats, we can expect a final crash with the liquidation of longs, after which a reversal will begin in the third or fourth quarter.
My current tactic: I am in a long position targeting $67,000–70,000, where I expect the market to gather liquidity. After that, I plan to accumulate shorts. The key level is $65,000. If it fails to hold above this level, I will exit the long earlier and start shorting, without waiting for $67,000.
Arguments for a New Bottom
On-chain data confirms my concerns. The Spent Output Profit Ratio (SOPR) has dropped to a 20-month low of -0.35. This level has not been seen since December 2022, when after the FTX collapse, bitcoin fell below $16,000. Historically, this indicator has accurately identified bottoms: a similar picture was observed in 2015 and 2019, followed by a reversal.
Additionally, bitcoin is trading only 16% above the realized price. Historically, at such proximity to this zone, the average return after six months was 41%, and after a year, 81%. However, the current macroeconomic uncertainty and structural market issues could disrupt this pattern.
My professional opinion: the market is at a critical point. While retail investors see the current rise as confirmation of a bullish trend, I recommend preparing for a 2022 scenario. The "bull trap" has already been formed, and the final capitulation could be the last opportunity for entry before the real reversal. Be cautious with leverage and do not give in to euphoria.