1. Standard Bitcoin Bull-Bear Cycle

Since 2011, Bitcoin's bull and bear markets have all followed very standard patterns, including:

a. The bull and bear markets are clearly distinguished and last for a long time. When the market is rising, it will continue to rise (but there will be a short crash of 40% in the middle), and when the market is falling, it will continue to fall.

b. A four-year halving cycle corresponds to a large bull-bear cycle. Especially in 2017, its trend perfectly replicated the bull market trend in the second half of 2013, allowing a large number of people who followed the trend to make a lot of money. This is also the fundamental source of the MA120-day/200-day bull-bear dividing line theory.

2. “Atypical” bull market

Compared with the previous typical bull-bear cycle, this round of bull market is somewhat "atypical". Although the fundamental law of "starting a violent bull market after halving" remains unchanged, but:

a. According to the four-year cycle theory, the bear market in 2018 is the same as the bear market in 2014. Even the number of days from the lowest point to half the value is almost the same (543 days vs. 507 days), which perfectly replicates the cycle. Then, 2019 should be the same as 2015, with the bottom sideways for a year. But in fact, from April to June in 2019, a small bull market with a 3.4-fold increase ($4133 to $13880) took only three months.

b. On March 12, 2020, there was another 312 flash crash that had never happened in history. From $10,500 on February 13 to $3,850 on March 13, the price dropped by 63% in one month, falling sharply below the MA 120-day and 200-day. In particular, from 8:00 on March 12 to 8:00 on March 13, the price dropped by 52% in 24 hours ($7,970 to $3,850). According to historical rules, a 63% drop would definitely mark the beginning of a bear market, right? But no, in less than two months, the price rose back to $10,074 on May 7.

c. After the halving bull market begins in 2021, according to the rules of 2013 and 2017, there should be multiple 40% pullbacks after the rise, but in reality there were only multiple 20% pullbacks, and the maximum pullback was only 30%.

d. After rising from $10,000 to $65,000 with almost no pullback, there was another 519 (high leverage serial liquidation) & 521 (policy strike) caused a 54% drop ($**843 to $30,066), which is equivalent to the superposition of 94 (policy strike) + 312 (high leverage serial liquidation).

3. Reasons for the atypical bull market

To explain these atypicalities, the 2019 bull market can be explained as being caused by plustoken, 312 can be explained as a series of high-leverage liquidations caused by the development of financial derivatives, and the lack of a pullback from $10,000 to $65,000 can be explained as massive purchases by institutional investors such as Grayscale and Tesla.

But in short, so many atypical factors indicate that we are in an atypical bull market, and there is no longer a clear-cut boundary between bull and bear markets (is the bull market still there after a 63% drop on March 12?).

4. Can we still look for the sword by carving a mark on the boat?

Since there is no longer a completely replicated historical experience, what else is eternal and unchanging? Only mathematical laws. Mathematical laws require very few assumptions, such as the cumulative increase in 60 days, assuming that the bull market of Bitcoin is caused by a large number of new people and new funds joining (this assumption is still true in this round of bull market, whether it is European and American institutional funds or a large number of ordinary people joining Animal Coin, it is similar to the previous round of bull market).

In the final stage of the bull market, market sentiment was fanatical, market participants exhausted their funds and leverage, and the coin price rose sharply in a short period of time. However, the speed at which new entrants and new funds entered the market could not keep up with the short-term surge in the coin price, resulting in the coin price not having sufficient buying funds to support it. It collapsed from a high point with a huge potential energy, and the bull market ended.

5. 60-day cumulative increase index

This process can be described in mathematical language as "the 60-day cumulative increase" is too high. The 60-day cumulative increase = the increase in the past 60 days, accumulated day by day.

In the backtest of historical data, the "60-day cumulative increase" indicator showed perfect consistency:

a. The most enthusiastic point of market sentiment = the highest point of currency price = the highest point of cumulative increase in 60 days, not a day off

b. The top K-line is pointed, not flat, because the most enthusiastic market sentiment is a point, not a period of time.

However, the high point of $**895 on April 13th just passed did not conform to this rule. There was a difference of 51 days between the highest increase in 60 days and the highest price of the currency. The K-line showed not a sharp top, but an arc top, which had appeared before.

This also makes a lot of old-timers in the cryptocurrency circle feel that the bull market is not over yet. "It hasn't even reached the frenzy of the demons dancing wildly yet, how can the bull market end?"

6. More reliable mathematical laws

Compared with historical experience, mathematical laws are more reliable and unbreakable. Therefore, we are still in a long bull market, and we are likely to be in a 312 crash (3 months later, in July 2021, it broke through the previous high). The worst case scenario is that we are in a short bear market in the 2013 double top bull market (7 months later, in November 2021, it broke through the previous high), and we will not face a long bear market.

Why won’t we face a long bear market? Because there was no previous wave of extreme enthusiasm that drained funds and hit the bulls hard, so there won’t be a long bear market.

If China's crackdown on trading and mining is not severe in the future, $30,000 may be the lowest point (similar to 312, the instantaneous oversold low point caused by a series of liquidations, and the 30,000 area had long-term support before the Chinese New Year). If the crackdown is severe, the lowest point may be $25,000 (a 63% drop according to the 312 convention). The short-term coin price is unpredictable, but in short, the bull market is still there.