Timing the Peak of the Next BTC Bull Run
When will Bitcoin reach the peak of its next parabolic advance? Probably at roughly the same time it did in the last rally. This seems straight forward enough, but other trend analysis on this platform has variously projected the next bitcoin price peak from sometime just after the third halving in May 2020 all the way to sometime in 2023. While the earlier prediction is highly unlikely, the extended prediction is supported by the fact that, peak to peak, the third bull run of 2017 was much more extended (1491 days) than the previous bull run (884 days). Therefore, we may assume that subsequent parabolic moves will also play out over longer and longer time frames.
However, the simplest answer is probably the best in this case. If we consider that the halvings are roughly 4 years apart, it is notable that the third peak came just over 4 years after the second peak. This suggests that in fact the peaks have become calibrated to the halvings and that the next all time high will come near the 4 year mark (or day 1460) as well. Bitcoin is unique in that the stock to flow ratio can be very precisely projected, unlike any other traditional market, making this rough prediction of the timing possible.
This probably doesn’t help us predict price discovery, however. Government regulation, current events, technological disruption, etc., etc., all affect market sentiment and make it nearly impossible to guess where the price will go. That said, we do know that the halvings will become more and more priced into market valuations in the future as the market gains a greater awareness of the halving algorithm, and this process has probably already started. Futures markets (CME & Bakkt) will also act as tempering forces on BTC volatility (apparently the intention when futures trading was launched on CME in 2017). And as the value of BTC has become more tagged to store-of-value than currency utility, volatility and price discovery have naturally been tamed (relatively), a process that will also continue. This is to say that conservative predictions may fall closer to the mark. On the other hand, the mere fact that flow is dramatically cut after each halving as demand continues to grow gives BTC bulls a lot of hope.
Whatever the peak of the next parabolic rally, it is likely to be tied closely to the halving cycle and stock-to-flow models, and trend lines will probably remain inside the general channel indicated by history. In other words, we're probably not going to the moon, but we are still holding the best performing asset ever seen.
Hopefully these observations aren’t too obvious. They are just meant to help us all keep our eyes on the big picture as we hodl into the future.
DF
However, the simplest answer is probably the best in this case. If we consider that the halvings are roughly 4 years apart, it is notable that the third peak came just over 4 years after the second peak. This suggests that in fact the peaks have become calibrated to the halvings and that the next all time high will come near the 4 year mark (or day 1460) as well. Bitcoin is unique in that the stock to flow ratio can be very precisely projected, unlike any other traditional market, making this rough prediction of the timing possible.
This probably doesn’t help us predict price discovery, however. Government regulation, current events, technological disruption, etc., etc., all affect market sentiment and make it nearly impossible to guess where the price will go. That said, we do know that the halvings will become more and more priced into market valuations in the future as the market gains a greater awareness of the halving algorithm, and this process has probably already started. Futures markets (CME & Bakkt) will also act as tempering forces on BTC volatility (apparently the intention when futures trading was launched on CME in 2017). And as the value of BTC has become more tagged to store-of-value than currency utility, volatility and price discovery have naturally been tamed (relatively), a process that will also continue. This is to say that conservative predictions may fall closer to the mark. On the other hand, the mere fact that flow is dramatically cut after each halving as demand continues to grow gives BTC bulls a lot of hope.
Whatever the peak of the next parabolic rally, it is likely to be tied closely to the halving cycle and stock-to-flow models, and trend lines will probably remain inside the general channel indicated by history. In other words, we're probably not going to the moon, but we are still holding the best performing asset ever seen.
Hopefully these observations aren’t too obvious. They are just meant to help us all keep our eyes on the big picture as we hodl into the future.
DF
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