The first cryptocurrency market is entering a danger zone. Bitcoin's current price dynamics are replicating the 2022 chart with alarming accuracy. If this analogy holds, we are witnessing the formation of the largest bull trap of the current cycle, followed by a final capitulation.
Fractal Similarity: June Bottom, False Bounce, and Crash
Analysis shows an almost mirror-like repetition of events from two years ago. First, a local bottom forms in June, followed by a sharp bounce that retail investors perceive as a reversal signal. Bitcoin is now retesting the 200-day moving average again. Retail demand is actively opening long positions, and euphoria is building. However, in my assessment, this rally will be followed by a sharp reversal downward.
The key fractal of 2022: a June bottom, a false recovery, RSI divergence, and a subsequent sharp sell-off. Let me remind you that after the June low in 2022, bitcoin lost another approximately 28% in November-December. If this scenario repeats, we can expect a final crash with the liquidation of long positions, after which a real reversal will only begin in the third or fourth quarter.
Strategy and Key Levels
My current tactic is built on the following: I am considering a long position with a target in the $67,000 – $70,000 range. It is at these levels, according to my calculations, that the market will gather maximum liquidity, after which I plan to open shorts. The critical level is $65,000. If bitcoin fails to hold above this level, I will exit the long early and start accumulating short positions without waiting for $67,000.
Arguments for a New Bottom
Objective on-chain data confirms this pessimistic forecast. The Spent Output Profit Ratio (SOPR) has fallen to a 20-month low of -0.35. This level was last seen in December 2022, when after the FTX crash, bitcoin plummeted below $16,000. Historically, this indicator has identified market bottoms with high accuracy — a similar pattern occurred in 2015 and 2019, followed by a powerful reversal.
Furthermore, bitcoin's current market price is only 16% above the realized price (the average acquisition price of all coins). Historically, such proximity to this zone has foreshadowed an average return of 41% in six months and 81% in one year. However, this does not negate the risk of a deep final drawdown before the start of a new bull market.
My professional opinion: The market is at a critical point. The 2022 scenario is not just a technical analogy but a reflection of deep structural problems with liquidity and sentiment. Investors should prepare for high volatility and a possible final sell-off, which will become the best entry point in recent years. Patience and composure are now the main assets.