Author: slightbourne@noblecapitalmarkets.com

Bitcoin began the week under heavy pressure, slipping below $93,000 on Monday and deepening a pullback that has now erased roughly 25% from October’s all-time high above $126,000. The sharp decline is forcing investors to reassess whether the recent weakness is merely a corrective pause—or the early stages of the crypto market’s historically familiar four-year cycle downturn.

The latest slide follows last month’s massive liquidation event, when roughly $19 billion in leveraged long positions were wiped out. That flush triggered a wave of forced selling and marked a turning point after months of aggressive bullish positioning. Long-term holders have also taken profits into strength, adding to downward pressure.

This correction arrives at a time that closely overlaps with Bitcoin’s typical post-halving peak window. Historically, new cycle highs occur between 400 and 600 days after the halving event. With the latest halving taking place in April 2024, Bitcoin is now within the same timeframe that preceded major tops in past cycles. This pattern has fueled what analysts describe as a “self-fulfilling prophecy”—investors expect weakness based on the timing alone, and their behavior creates selling pressure that brings it to life.

Still, several research groups argue that this drawdown does not resemble the steep 60–70% collapses seen during prior cycle peaks. Analysts point to structural differences in today’s market, including far deeper institutional participation and the rapid growth of Bitcoin ETFs. Large asset managers have continued adding exposure even as prices fall, a sign of what they describe as “higher-quality and more consistent ownership.”

Supportive regulatory developments may also help cushion the decline. The Trump administration’s pro-Bitcoin stance, along with ongoing progress on the Clarity Act in Congress, is widely viewed as a net positive for long-term market maturation. Some analysts believe this framework is helping shift Bitcoin closer to a mainstream institutional asset class, with corrections becoming less extreme than in past cycles.

MicroStrategy continues to reinforce that thesis. The company revealed another significant purchase on Monday—8,178 additional Bitcoin at an average price of $102,171 each, totaling $835 million. The firm’s steady accumulation, even during periods of weakness, remains a confidence anchor for parts of the market.

But short-term risks remain elevated. Research firm 10X noted that new buyer momentum stalled around October 10, leaving the market vulnerable as macro conditions deteriorate. A more hawkish tone from the Federal Reserve has pressured risk assets broadly, tightening financial conditions and raising the threshold for speculative flows into crypto.

Analysts have flagged $93,000 as a critical support zone. A decisive breakdown could spark another wave of liquidations, adding volatility to an already fragile environment. Some believe Bitcoin could retest support near the $80,000 level—last seen shortly after the U.S. election—before finding a durable bottom.

Even so, many long-term investors view the current weakness as a potential entry point rather than the start of a prolonged bear cycle. With institutional adoption rising and ETF inflows broadening the asset’s investor base, the coming weeks will determine whether Bitcoin stabilizes—or whether the deeper mechanics of the four-year cycle will reassert themselves.