Bitcoin has a way to turn numbers into memories.
You remember the first time you broke $10,000, $20,000, $100,000, you remember the mood swings when you lost your optimism, you remember the quiet weeks when every bounce felt like a trap, you remember the tumultuous weeks when it felt like the floor disappeared.
The defining memory of this cycle will be $126,000.
That was the high I anchored at and the moment the tape stopped behaving like an uptrend and started looking more like a distribution.
I made the case in October when I wrote that the bear market cycle started at $126,000, but the market does what it often does after a cycle peak: first it loses confidence, then it loses price.
As I write this, Bitcoin is down about 51% from its cycle high.
On the chart, the current drawdown looks uncomfortably familiar.
I went back through previous major cycles and pulled up after each roughly 50% drop from the all-time high and watched what happened next.
The shape will never be the same, the drivers will change, the plumbing will change, the participants will change, but human patterns will still repeat, be denied, negotiations will bounce back, and at that moment people stop asking, “Are we done yet?” and start asking, “How low can we go?”
In 2018, Bitcoin had already fallen about 50% from its peak, and then fell another 70% before entering the true bottom of the cycle.
In 2022, the next leg after a 50% drawdown was smaller and closer to 50%.
If we take this decline in severity at face value, the next ‘post-50’ period of this cycle could approach 30% in the best case, but could be much worse if we behave more like the old regime.
From here another 30% to another 70% is wide enough that it’s pretty useless on its own, but it does give you direction.
The point of writing about bear markets is to narrow down the problem to something human, something you can prepare for, and something you can observe in real time without losing your mind.
That is the purpose of this article, to connect what I have written throughout this cycle with what past drawdown patterns have shown, and translate it into practical medium-term levels and scenarios, with clear signals that force me to change my mind.
The moment you stop trusting cycles and why charts still matter
Before reaching the high price of $126,000, I spent a lot of time thinking about time.
Bitcoin has a cycle clock, which is imperfect and often ridiculed, yet it is one of the few frameworks that can remain stable even when everything around it is noise.
In September 2025, I wrote that the cycle clock would show its last high by late October, but the real question is whether ETFs will rewrite history. That piece was an attempt by me to hold two truths at the same time: there is a rhythm to the cycle, and this cycle has a different structure.
After less than three weeks, I stopped dancing around it. I wrote that if there is a high and the bear market cycle starts at $126,000, then time is up. It was a fine line because I learned the hard way that a peak market doesn’t feel like a peak, it feels like it’s starting.
Now we have the benefit of data and a chart that we can interrogate without ego. Using weekly BTC charts, we used peak weekly highs to mark the top of the cycle and subsequent weekly lows to track drawdowns. The method is the same from 2017 to 2018, from 2021 to 2022, and from 2025 to the present.
Here’s what the study says in plain language:
In 2017, the peak week high was about $198,000 and the trough week low was about $3,100, resulting in an 84% peak-to-bottom collapse.
In 2021, the peak week high was around $69,000 and the trough week low was around $15,000, resulting in a 78% peak-to-trough collapse.
The peak weekly high in 2025 is about $126,200 and the weekly low so far is about $60,100, a 52% drawdown so far.
Charts cannot tell you the future, but they can tell you about the current system. A 52% drawdown from cycle highs is not a new condition for Bitcoin, but a well-known stage in the process.
The unpleasant part is what tends to happen next. Because in the previous two cycles, the “down 50” was closer to the middle than the end.
That’s why I keep going back to level and condition, rather than trying to win an argument with a single number.
The level map I gave you and what it was trying to protect you
In November, after the cycle highs were in the rearview mirror, I wrote a consciously pragmatic article about Bitcoin hitting $73,000, a price level to watch out for during a bear market. It was an attempt to replace the scary range with stepping stones.
There was a clear staircase on that map.
First, the market had to deal with $85,000, a level that remains in people’s minds as the dividing line between “this is a correction” and “this is something else.”
Then there was $73,000. This is an important level because it is psychologically important and structurally important, it is located close to the previous regime, it is where we would expect push buys to take a stand, and it is where we would expect sellers to test whether their bids are genuine.
Below that, we highlighted $49.8,000 as the bottom shelf. This is the kind of number that starts showing up on long-term charts as a magnet when the market is looking for places that are publicly wrong.
A few days later, I went further and put my name on a medium-term bearish thesis that Bitcoin could fall to $49,000 and that this winter could be the shortest yet. That part wasn’t just a price call, it was a framework with a scenario, a soft landing case, a base case, a deep cut case, and a series of flip levels to show us which path we were on.
Then January arrived and I described how the month had been in terms of red flags, especially since the plumbing was already strained.
This phrase plumbing is where the objective part of the story is located.
Price is the headline. Plumbing is the part that bothers you in bear markets because it turns an orderly decline into a cascade. It’s the difference between a decline that feels like an opportunity and a decline that feels like a warning.
Medium-term questions are therefore easy to ask, difficult to answer, and very personal to those at risk. Will the price affect the broken pipe or will the pipe recover before printing deeper levels?
Drawdown patterns and why I keep talking about declining declines
When I compared previous drawdowns after Bitcoin was already down about 50% from its peak, I wasn’t trying to create a magic formula. I was trying to quantify the feeling of having different types of pain with each cycle.
During the 2017-2018 bear market, we were already down about 50% from our highs, but there was still a brutal amount of air underneath the market. In the 2021-2022 bear market, the further declines beyond the midpoint were smaller, but still nasty and, while still sufficiently damaging, not as severe as in previous cycles.
In research I built based on data, the “add after minus 50” decline rate was about 68% for the 2017-2018 cycle and about 55% for the 2021-2022 cycle.
Therefore, it is reasonable to ask whether that additional leg will contract again.
If it contracts again, we would have what appears to be the best-case downside path from here, with another ~30% drop from current levels. This is the logic behind the range from another 30% to another 70% from here, depending on whether history repeats itself gently or harshly.
The problem is that “from here” is a moving target, and bear markets are rarely polite. It does not descend in a straight line. They punish the guilty on both sides. They produce rallies that feel like salvation, and dumps that arrive just after people are convinced the worst is over.
Therefore, I don’t want to sell you a single prediction. Medium-term goals make sense within a historical framework and provide conditions for changing probabilities from one scenario to another.
Medium-term goals, three scenarios that require rethinking
This is the cleanest way to put it together, using the level map from November’s work, the identified drawdowns, and the plumbing signals flagged in January.
Scenario 1, soft landing, $56,000 to $60,000
This is when the market has already done most of the emotional work. We’re down 50%, the late longs are over, we’ve scared off the weak hands, and now we’re moving into a short winter.
I depicted this as a “soft landing” band in my paper because if structural demand holds, Bitcoin could absolutely bottom out higher than the doomsayers expect.
What makes this scenario feel real is a change in the underlying signals.
In the same paper, I discussed “flip levels” which are more important than atmosphere, ETF flow behavior, fee share in miner revenue, and hash price stability. Sustained improvement there increases the probability of higher lows and reduces the amount of time the market spends looking for dramatic bottoms.
Scenario 2, base case, $49,000
This is still my main medium-term goal. One of the reasons bear markets are so important is that the levels that make most people feel sick have very strong historical support. A long time ago, in 2021-2022, institutional buying peaked at the mid-$40,000 mark, and it was defended repeatedly.
Bear market lows are social events. Those are the points where the story breaks down. A $49,000 print edition will do just that, especially for those who have their psychology locked into six figures.
The November level map called $49,800 the bottom shelf for that part. The mid-term paper then claimed $49,000 as a base scenario and continued to track its path until January, when the plumbing started issuing more warnings in this update.
This is also where the past drawdown envelope is kept honest. The rise from a high of $126,000 to $49,000 is still a smaller overall decline than in 2018 and 2022, and fits the theme of decreasing severity while honoring Bitcoin’s tendency to punish complacency.
Scenario 3, deep cuts, $36,000 to $42,000
There is a reason we included this range in the original paper. Even if you don’t want to live there, you should know that this scenario exists.
Deep cuts are what happens when the market reprices risk as well as confidence in the structure, and it can occur due to a combination of sustained capital outflows, miner stress, fee droughts, and macro shocks.
In my paper, I framed this as a late 2026 to early 2027 risk rather than a short-term certainty. He also mentioned that timing is important because deep bottoms tend to be a process rather than a day.
This is also a scenario that makes the historical parable feel like 2018, a long period of suffering in which no one believes until the final surrender arrives.
The $73,000 problem, why it matters, and why it’s not the goal
I want to go back to $73,000. Because that’s the level that most people have to grasp emotionally.
In that November article, I wrote about “Bitcoin to $73,000.” Because I wanted readers to plan for their first big battle. That battle is where push buys come out loud, influencers rediscover their faith, bears book profits, and the market decides whether to deal with an air pocket or a staircase.
If Bitcoin regains $73,000 and the plumbing improves at the same time, the market could stabilize higher than people expected.
If Bitcoin can’t get back to $73,000 and the pipes continue to fray, $56,000 to $60,000 will start to feel like the next serious destination, and $49,000 will start to sound less dramatic and more mechanical.
That is the true value of levels in a bear market and helps turn panic into a checklist.
What makes me change my mind so quickly?
I don’t think readers need another list of scary numbers. They need to know what to watch to stay sane.
The flips I’m looking at are the same ones I laid out in my midterm paper and flagged again in the January update.
- It matters if the ETF’s flow behavior changes, if the market starts absorbing supply on red days, if the sell-back reflex weakens.
- It will be important if hash prices stabilize rather than hitting new stress lows as miners’ economic situation improves and fee shares become meaningful support again.
- If these conditions improve while the price is still in the danger zone, the probability weights will shift from a deep cut towards a soft landing.
- If these do not improve and prices continue to cleanly destroy support, the base case will become a magnet and the deep notch will remain a tail risk that remains on the table.
That’s the point of the framework, forcing you to be honest when the market changes.
Finally, the human part of the bear market
I’ve been through enough Bitcoin cycles to know that the hardest thing is not to go down, but to wait.
It’s the weeks when nothing happens and you start imagining the worst, the weeks when something happens and you convince yourself it’s over, the moment you realize your period was shorter than you had told yourself.
We are currently part of that cycle. The market has already done enough damage to feel like a bear market, but not yet enough damage to satisfy the harshest version in history of what happens next. Uncertainty is exhausting, which is why you see people arguing with so much certainty.
So here’s my honest reading, based on what I wrote at the time, what the historical losses are showing, and what the plumbing is showing.
$73,000 is a fight, $56,000 to $60,000 is a test of whether this winter will indeed be short, $49,000 is a base case ledge that fits into a decreasing cycle of decline, and $36,000 to $42,000 is a deep cut scenario that will only be possible if internal stresses remain broken for longer than most people are prepared for.
You don’t need to know exact numbers to be helpful. They need to be early enough to help prepare, and flexible enough to recognize when the market overrides the framework.
That’s what I’ll continue to do. With a chart in one hand and a plumbing gauge in the other, I try to remain objective while Bitcoin does what Bitcoin does.
This analysis reflects my personal market framework and interpretation of historical data. Nothing in this article should be taken as investment advice or a recommendation to buy or sell any property. Readers should make their own decisions based on their risk tolerance and circumstances.
(Tag translation) Bitcoin
