Month 35 Alert: Critical Bitcoin Analysis as Cycle Timing Peaks
Bitcoin Roadmap
With the crypto market experiencing major liquidations, now seems like the right time to analyze what's happening and identify the key scenarios to watch.
Bitcoin has already undergone what I consider a healthy correction, declining from its all-time high of $123,800 to approximately $107,000. Following this drop, Bitcoin rallied back to $118,000 but has since entered another corrective phase, currently trading around $112,500.
This represents roughly a 10% pullback—relatively shallow compared to other corrections we've witnessed in this cycle. The key question now is: was this correction sufficient?
Looking at the weekly chart, Bitcoin appears to be facing rejection at the 10-week moving average. This type of price action often signals a final shakeout before a more substantial move materializes. I believe we're observing the conclusion of a weekly correction cycle that has been developing since early August.
The Bullish Case: Why This Could Be the Launch Pad
Several factors point to a potentially explosive move higher in the coming months. First, the weekly bollinger bands have compressed to some of the tightest levels we've seen in this entire cycle. When these bands squeeze this tight, it typically precedes a substantial move, and given where we are in the broader market cycle, that move is likely to be upward.
The timing also aligns perfectly with seasonal patterns. October and November have historically been strong months for Bitcoin, and we're approaching what should be the final phase of this major cycle. What's missing from this cycle so far is the euphoric, speculative blow-off top that typically caps these major moves. With institutional involvement, increased media attention, and a supportive political environment, the stage appears set for exactly this type of dramatic finale.
From a technical perspective, even if this correction takes us slightly below the recent $107,000 low, it would still be considered healthy and potentially bullish. Despite all the selling pressure over the past several weeks, Bitcoin is holding up remarkably well, suggesting strong underlying demand. A quick dip below the last low followed by a swift recovery would actually demonstrate the market's resilience and could set up an even more powerful move higher.
The Bearish Scenario: What Could Go Wrong
While my primary view remains bullish, it's crucial to understand the scenarios that could derail this outlook. The main bearish case would unfold if we see a move to new all-time highs followed by a quick rollover and failure to remain in a daily uptrend - especially this late in the cycle.
Here's how this could play out: Bitcoin rallies from current levels to new highs, perhaps reaching the $125,000 to $130,000 range by late October or early November. Everyone gets excited, jumps back in, but then the rally fizzles out. If we see a peak around this timeframe followed by a decline that takes out the current correction lows, that would be a major warning sign.
The timing would be particularly concerning because October would mark month 35 of the current cycle, which matches the duration of the last three major cycles perfectly. A peak at this timing, followed by a breakdown below the $107,000 level, would signal that the 4 year cycle high is likely confirmed.
What About Altcoins?
During this recent Bitcoin correction, we saw Bitcoin's market dominance spike higher, which put pressure on altcoins. However, many of the stronger altcoins are holding up well relative to Bitcoin, which is encouraging.
Coins like Ripple, Avalanche, and others demonstrating relative strength continue to trend above their key moving averages versus Bitcoin. This suggests that when Bitcoin resumes its uptrend, these altcoins should outperform significantly. Based on this strength, I added positions in HYPE, XRP, LINK, and EIGEN during today's weakness.
Bitcoin dominance appears to have peaked for this cycle and remains in a longer-term downtrend, meaning any current strength is likely just a temporary counter-trend move.
The Most Likely Scenario
I believe we're very close to the end of this weekly correction. The combination of compressed volatility, seasonal tailwinds, cycle timing, and the relatively shallow nature of this decline all point to a resolution higher rather than lower.
I expect we may see a bit more weakness over the next week, possibly testing that $105,000 to $106,000 area, but then a strong reversal should begin. Once we clear back above $118,000, I think we'll see the start of that final explosive phase that takes Bitcoin to significantly higher levels before this cycle peaks.
The key is to remain patient and let this correction run its course.
This market has done an excellent job of shaking out both bulls and bears in recent weeks, which is exactly what you'd expect before a major directional move. All signs point to that move being higher, setting up what could be one of the most spectacular finales to a Bitcoin cycle we've ever witnessed.
The stage is set, the technical conditions are aligning, and the timing appears perfect.
Thanks for reading!
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Written by Timothy Assi, an Elite Popular Investor on eToro.
Not investment advice. eToro is a multi-asset investment platform. Your capital is at risk. For information and educational purposes only.
Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.
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