Bitcoin (CRYPTO: BTC) appears to be tracking a familiar midterm-year bear market pattern, with one analyst warning that any early March strength may prove temporary rather than signaling a durable low.
Bounce In Early March, But A Bull Trap?
Crypto analyst Benjamin Cowen says Bitcoin is closely mirroring price behaviour seen in prior midterm years, 2014, 2018 and 2022,: weakness into February, a brief rally in early March, and then another leg lower into spring.
While Cowen acknowledges that a short-term bounce looks increasingly likely, he cautions it may be a bull trap rather than a true cycle bottom.
From a technical standpoint, several historical bear market bottom conditions remain unmet.
Bitcoin has not yet tagged the 200-week moving average, nor has it broken below realized price or balance price, levels that have historically aligned with major long-term lows.
A wick into the 200-week MA followed by a counter-trend rally is possible, he notes, but even that may not mark the ultimate bottom.
Based on Bitcoin’s four-year cycle tendencies, May represents an early potential window for a low, while October may statistically carry higher probability.
Macro Backdrop Adds Pressure
Cowen also highlights broader macro risks.
His late-cycle business cycle model, which blends the S&P 500, unemployment data, inflation trends, interest rates and M2 money supply, suggests the economy may be approaching recessionary conditions.
Historically, when this composite indicator reaches similar levels, economic contraction has followed.
The risk sequence appears to be unfolding in stages: altcoins have been in prolonged decline since late 2021, Bitcoin has weakened more recently, and equities could be next.
Midterm election years have historically shown stock market weakness between March and October.
If equities experience a significant correction during that window, it could accelerate layoffs and increase recession risk. In previous cycles, energy and commodities were typically the last sectors to roll over.
For now, while a short-term bounce may offer relief, the broader structural and macro backdrop suggests caution remains warranted.
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