Data Decoding BTC Cycles: Three Major Bottom Signals Illuminate, Q4 Could Become a Key Turning Point Window?

Original by Odaily (@OdailyChina)

Author: jk

In October last year, the night BTC broke through $120,000, countless people screenshotted the chart and posted it on their social media, captioning it "Witnessing history." Just eight months later, the same people were staring at a price of $59,100, with their captions changed to "Will it drop further?"

From a peak of $126,198 to a low of $59,100, BTC has retraced over 52%; in early June, the Crypto Fear & Greed Index fell to 8, the lowest level since 2022.

Is entering now brave bottom-fishing, or passive catching of a falling knife?

In 2018, people said BTC would eventually go to zero; in 2022, they said the crypto industry was finished after the FTX collapse. By 2026, the narrative had shifted to "the four-year cycle is dead," "institutional entry only leads to sell-offs," and "risk assets have no future in a high-interest-rate environment." Each time, these narratives sound most indisputable when prices are at their lowest.

However, narratives are emotional, while data is neutral. Only by separating the two can the current market position become clear. Let's take a look together: exactly where are we in the BTC cycle right now?

Where Does a 52% Decline Fit in Historical Cycles?

On October 6, 2025, BTC reached its all-time high of $126,198. From that day to the intraday low of approximately $59,100 on June 5, 2026, this retracement peaked at over 52%.

A 52% drop sounds alarming, but compared to BTC's three previous complete bear markets, this figure is actually below the historical median. The 2014 bear market fell 86% from peak to trough, 2018 saw an 84% decline, and 2022 dropped 77% from $69,000 to $15,479. The current cycle's maximum drawdown of approximately 52% is significantly milder than the previous three.

That said, historically, prices have recovered after deeper declines. While this statement might seem somewhat assertive, from a market confidence perspective, the fear surrounding the current price likely exceeds the actual risk implied by fundamentals.

This is precisely why it's often said that market confidence is more precious than gold.

Four Halvings, Three Nearly Identical Curves

Understanding the current position is impossible without the framework of the halving cycle.

BTC halves approximately every four years, cutting block rewards for miners in half and contracting new supply. Around each halving, the past three cycles have followed remarkably similar bull-bear rhythms: a peak 12 to 18 months after the halving, a bottom 12 to 14 months after the peak, and the bottom typically occurring about 17 months before the next halving.

• Cycle 1: The halving in November 2012, when BTC was only $12. About 12 months later, in November 2013, the price peaked at $1,150. The subsequent bear market lasted about 13 months, bottoming around $160 in January 2015, which was roughly 18 months before the next halving (July 2016).
• Cycle 2: The halving in July 2016, when BTC was around $650. About 17 months later, in December 2017, the price peaked at $19,800. The subsequent bear market of about 12 months bottomed around $3,200 in December 2018, which was roughly 17 months before the next halving (May 2020).
• Cycle 3: The halving in May 2020, when BTC was around $8,600. About 18 months later, in November 2021, the price peaked at $69,000. The subsequent bear market of about 13 months bottomed around $15,500 during the FTX collapse in November 2022, which was roughly 17 months before the next halving (April 2024).
• Now, Cycle 4. The halving occurred on April 19, 2024, reducing the block reward from 6.25 to 3.125 BTC, with the price around $63,000 at the time. About 18 months later, BTC peaked at $126,198 on October 6, 2025, perfectly within the historical '12 to 18 months to peak' window.

As of June 2026, it's been about 26 months since the 2024 halving and about 8 months since the October 2025 peak. Based on historical patterns, a bottom typically occurs 12 to 14 months after the peak, suggesting the bottom window could fall around October 2026, which would be roughly 17 months before the next halving (April 2028), aligning almost perfectly with the previous three cycles.

BTC Halving Timeline

From the current standpoint, the second half of 2026 looks more like a phase in this cycle where risk-reward ratios warrant reassessment, rather than a time for simply panicking and exiting.

The supply contraction post-halving is ongoing, and the persistent buying pressure from spot ETFs and institutional capital has changed BTC's market structure, which was previously driven solely by retail sentiment. If historical cycles continue to play out, around Q4 2026 could be a critical window for the market to transition from pessimism to recovery, from deleveraging to reaccumulation. For investors bullish on BTC's long-term value, short-term pullbacks might actually present more attractive opportunities for phased accumulation. As the bottoming zone gradually approaches, market confidence is likely to rebuild, and the foundation for the next upward cycle may be quietly forming during this phase.

On-Chain Data: Three Low Signals Flashing Simultaneously

Beyond price charts, on-chain data provides more fundamental valuation references.

1. Indicator 1: MVRV Z-Score. This measures the deviation between the current market price and the average cost basis of all holders. Historically, a Z-Score above 7 indicates severe overvaluation, near a top; dropping near 0 or turning negative corresponds to deeply undervalued zones. When BTC peaked in October 2025, the Z-Score was around 5 to 6. According to MacroMicro data from June 9, the current Z-Score is approximately 0.27, nearing the boundary of historical bottom zones.
2. Indicator 2: Network Realized Price. This is the average cost basis of all circulating BTC, weighted by the price of its last on-chain move. CryptoQuant Research Head Julio Moreno noted on June 10 that this current value is around $53,600. Based on the current market price of ~$62,000, the market price is only about 9% above the network average cost – a historically rare low premium. In the past three cycles, major bottoms formed near or slightly below the realized price, briefly breaking below it in November 2022.
3. Indicator 3: 200-Week Moving Average (MA). This average represents the mean price over the past ~4 years and currently sits around $62,200. On June 4, 2026, BTC touched this line for the first time in the current cycle. The bear market bottoms of 2015, 2018, and 2020 all occurred precisely around this line. 2022 was the only exception, where the price broke below the MA and stayed there for about 16 months, culminating in the FTX collapse.

200-Week Moving Average Price. Source: TradingView

Capital Flows: Retail Out, Whales In

Beyond the low valuation signals, the structure of capital flows also shows some bottoming characteristics.

On the ETF front, from mid-May to early June, US spot BTC ETFs saw net outflows for 13 consecutive trading days, totaling approximately $4.4 billion (about 59,400 BTC), the longest sustained outflow since their launch. BlackRock's IBIT saw a record single-week outflow of approximately $980 million. This reflects panic redemptions from short-term capital and retail investors.

Simultaneously, contrasting moves appeared on-chain. The number of whale addresses holding over 100 BTC reached a new high for 2026, around 20,229. Net buying by whales in the first five months of 2026 already equaled the total for the entire year of 2025. Strategy sold 32 BTC in late May to pay preferred stock dividends, its first sale in four years, sparking concerns about a strategic shift. However, two weeks later, on June 8, the company bought 1,550 BTC at an average price of $65,332, bringing its total holdings to 845,256. Michael Saylor described this move as "a good time to add."

At the exchange level, BTC balances on major exchanges have been steadily declining over the past few months, with coins flowing from trading platforms to long-term holders and institutional cold wallets. Currently, long-term holders (holding for over 155 days) control approximately 78% of the circulating supply, one of the highest proportions in history.

Macro: The Biggest Uncertainty, Half Removed

The core macro logic suppressing BTC over the past few months stems mainly from two factors: high interest rates and the Iran war.

In early 2026, the US and Israel launched military strikes against Iran, leading to a partial blockade of the Strait of Hormuz. The IEA classified this as the largest supply disruption in global oil market history, sending international oil prices spiking to $105-$120 per barrel. Inflation subsequently rebounded, with the US May CPI rising to 4.2%, far exceeding the 2% policy target. The Federal Funds Rate was consequently held steady in the 3.50% to 3.75% range, with the market pricing a ~79% probability of "zero rate cuts" for 2026. The US Dollar Index strengthened to around 99-100. This dual pressure of high rates and risk aversion meant that despite global liquidity expanding, it couldn't flow into the crypto market.

However, on the night of June 14, US President Trump announced the completion of a US-Iran agreement. Iran's Supreme National Security Council subsequently issued a statement in the early hours of June 15 formally confirming a ceasefire memorandum of understanding. The formal signing ceremony is scheduled for June 19 in Switzerland, and the Strait of Hormuz will be reopened subsequently.

The market reaction was immediate and dramatic. WTI crude oil fell over 4% to about $80.25/barrel that day, while Brent crude dropped to around $83.51. BTC jumped from about $61,500 before the announcement to over $65,000, a single-day gain exceeding 5% – the largest rebound in three months – accompanied by a surge in volume. Futures for the three major US stock indices all rose over 300 points, and Asian markets rallied.

Following the agreement, Deutsche Bank stated that it expects the risk of Fed rate hikes to fade in the short term. However, due to sticky inflation, resilient labor markets, and the possibility that the neutral rate is higher than expected, the risk of rate hikes in 2027 remains. The Fed's situation will ultimately depend on the debut of the new Fed Chair, Kevin Warsh.

Conclusion: A Bottom, Yet Also a Time of Greatest Uncertainty

When BTC was above $120,000, everyone was willing to believe it would go higher. But when it falls back near $60,000, and on-chain valuations, cycle position, long-term holder ratios, and macro variables all begin pointing towards a bottom zone, the market is paradoxically lacking the most in confidence.

Yet, investing is never done when emotions are most comfortable. Historically, every BTC bottom has been accompanied by 'this time is different' skepticism and widespread doubt about the industry, the cycle, and the asset itself. The difference lies only in whether one uses this doubt as a reason to exit or as an opportunity to reprice risk-reward dynamics.

Current BTC levels, of course, don't guarantee no further declines, nor does it mean this is definitively *the* bottom. But if we take a longer-term view, separating short-term panic from long-term structure, the current zone is no longer suitable for being defined as 'chasing highs.' It more closely resembles a window for phased accumulation requiring patience, discipline, and conviction.

Market confidence is truly more precious than gold. Because gold only hedges against inflation, while confidence can transcend cycles. For those who still believe in BTC's long-term value, in scarcity, and that global liquidity will eventually return to risk assets, the most important question for the second half of 2026 might not be "Will it drop further?" but rather "When the market regains its faith, will you already be in position?"

What will you choose to do?