Bitcoin Bear Market Showing Signs of Reversal? Six Signals Observed

While it's too early to declare the end of the 'crypto winter' bear market, several of the six signals seen during past rebounds have reappeared. Morgan Stanley Wealth Management Global Investment Office Executive Director Denny Galindo examined Bitcoin (BTC) cycle patterns in a recent Coindesk Indices analysis published on June 15. Galindo emphasized that these six signals are observational rather than predictive, noting they "could be false or premature." The analysis began by referencing Bitcoin's historical four-year cycles, with the completed four cycles showing approximately three years of bull markets followed by 12-14 months of bear markets.

The first signal is cycle timing. Past rebounds typically started around 17 months before the next halving event or 12-14 months after the previous peak, with September 2026 noted as having 17 months until the next halving and 11 months remaining until the prior high. Bitcoin.com estimates the next halving will occur at block height 1,050,000 in 2028, noting halvings aren't fixed-date events but rather occur approximately every 210,000 blocks.

The second signal is exchange and institutional stress. Historical analysis suggests major exchanges' bankruptcy or closure preceded rebound periods. The third signal is the peak-to-trough drop. Coindesk cited a 53% decline from October 6, 2025 to June 30, 2026 based on Bloomberg price data, which is shallower than historical bear market drops of 77-84%. However, whether this adjustment qualifies as a reversal signal requires further examination.

The fourth signal is mining difficulty. Mining difficulty indicates the competitive level required for Bitcoin mining, and historically has signaled transitions from bear to bull markets after declining but before rebounding. The analysis notes difficulty has declined but hasn't yet rebounded.

The fifth signal is the thermocap multiple. Thermocap represents cumulative value paid to miners, with the thermocap multiple comparing Bitcoin's market cap to this cumulative value. Coindesk reported based on Glassnode data that the thermocap multiple fell to 13x as of June 30, 2026, though verifying this calculation from publicly available data is challenging.

The sixth signal is price movement. Past market lows saw a 50% rebound from lows, but there's no guarantee this pattern will repeat. This makes it difficult to confirm trend reversal based solely on price rebounds. The analysis questions whether Bitcoin will reclaim its all-time high before the next halving and whether AI has replaced virtual assets as the dominant narrative for speculation and innovation.

Historical cycles from 2012-2016 and 2016-2020 saw highs surpassed after halvings, but in the 2024 cycle, Bitcoin broke previous highs a month before the halving in April 2024. While some analyses have suggested similarities between current market conditions and past bottoms, those comparisons didn't definitively confirm bottoms at the time. This analysis focuses on checking historical patterns against current indicators rather than declaring an end to the bear market.

Market structure means price, mining difficulty, and thermocap multiple use different calculation methods and timelines. Therefore, improvements in one indicator should be confirmed with other indicators moving in the same direction. For domestic investors, it's important to distinguish between the basis dates and collection methods of each metric rather than simply applying halving timeframes and price drops.