Bitcoin is exhibiting textbook bottoming characteristics across several indicators, trading at levels that historically precede significant recoveries, according to prominent onchain analyst James Check. However, time — not price — is likely the biggest test for bitcoin bulls.
“Every mean reversion pattern, from technical to onchain trades within bottom formation levels, typically seen after the price capitulation event (of which December 2018 and June 2022 were examples),” Check wrote on Tuesday morning as bitcoin dived through $63,000, apparently on its way to testing the February 5 panic low of $60.
“Either Bitcoin is dead, there’s no going back, and all your models are broken,” Check continued. “Or you should ignore the bears … and quietly dollar cost average [and] stack rate from here.”
While Check allows that it is possible or even likely that the price of bitcoin could fall even further from here, time plays the key factor. He recalls the brutal bear market of 2022. People remember the low price of around $15,600 in December of that year, but bitcoin essentially reached around $17,600 six months earlier. The rest just waited and saw a final liquidity flush (around the FTX collapse).
“This is literally what a risk-free setup looks like for bitcoin,” Check concluded. “If you are not actively accumulating bitcoin at this stage, then when?”
