El Bitcoin, a punto de caramelo

New bullish cycle may be approaching for Bitcoin

There are indications that we could be on the brink of a new bullish cycle for Bitcoin. The cryptocurrency has been performing exceptionally well in recent months, with major price gains in both Europe and the United States. The chips (SOX) have also managed to handle the previous extreme highs.

While there has been some nervousness in the bond markets due to renewed inflationary tensions, especially in the last sessions of August and the start of September, everything appears to be under control. The star market of this summer has been cryptocurrencies, with Bitcoin increasing by 28% in August and by 40% since the June lows. Ethereum also gained 36% in August and has risen by 66% since the June lows. The million-dollar question remains: have we seen the worst yet, and has a new bullish cycle already started?

Bitcoin's price has fallen slightly below its last major peak, which occurred in early May at $83,215 on the CME futures contract. Above this peak, we would consider a potential double bottom with wide bullish implications. The most important aspect to watch is the weekly and monthly low created in February (84,560). This gap was filled in May, falling to $58,200 before dropping further. For Ethereum, the corresponding low in February is $2,709 on the CME futures contract.

In simple terms, if we see Bitcoin and Ethereum closing the weekly and monthly lows mentioned above, and ideally in the monthly period as well, we could be on the verge of a new bull market. Additionally, considering the four-year cycles of Bitcoin, there is a high probability that this summer's bottom could serve as the bottom of the last major bear market and the starting point for a new bullish cycle.

This happened in January 2015, when Bitcoin was around $160, marking the beginning of the bull market that took it to $20,000 by December 2017 before falling to $3,200 in December 2018.

From that point, with strong market swings, Bitcoin reached a new market ceiling in late 2021 at $69,000 before correcting to $15,000 in November 2022. Again, this is roughly a four-year cycle from the previous bottom to the next one. If we extrapolate this pattern to the last bottom in November 2022 and add a little over four years, we arrive at the bottom in August/September, which is exactly where we are now.

In summary, the conditions are in place to believe that we are at the doorstep of a new bullish cycle for Bitcoin and, consequently, the crypto ecosystem. However, we need just a small push: to break the wide weekly and monthly lows created in February for both Bitcoin and Ethereum.