Bitcoin Outlook Brightens as Halving Cycle Suggests End to Bear Market

The historically-reliable 4-year halving cycle suggests that Bitcoin's bear market may soon be coming to an end, if it hasn't already.

Renewed ETF purchases, compelling valuations, and an improvement in buy-and-hold behavior among investors have turned the outlook for Bitcoin in Q4 cautiously optimistic.

The balance of risks for Bitcoin is gradually shifting to the topside, with the near-term bias outright bullish above the $80K round handle from a technical perspective.

According to analysts, the 4-year cycle centered around the Bitcoin Halving has relatively reliably helped traders identify significant tops and bottoms over the years. The most recent halving in April 2024 took the 'inflation rate' of Bitcoin's supply to below 1% per year, less than half of gold's annual inflation rate.

The growth rate of fiat money in the financial system has slowed in recent months, with M2 dropping toward 6% from prior highs near 12%. The theme of 'hard money' or a hedge against fiat currency debasement could continue to support Bitcoin's price as long as the global supply of money continues to increase.

Broadly speaking, a renewed uptrend in Bitcoin ETF purchases should support the cryptocurrency, whereas a shift toward concerted selling could weigh on it. The MVRV (Market Value to Realized Value) Z-score has bounced to 0.8, closer to the typical bear market bottom zone at 0.0 than the late 2024 peak above 3.0.