Bitcoin cycle signals $40K–$46K bottom, Galaxy warns
Galaxy Research says the Bitcoin cycle is still active, but price swings are “compressing,” with each four-year cycle moving less violently. Head of Firmwide Research Alex Thorn bases a base-case downside zone on market and onchain data.
Key call: Galaxy’s base-case places a possible Bitcoin bottom between $40,000 and $46,000. A deeper “washout” scenario is $30,000–$37,000, while a shallower outcome could hold $51,000–$54,000. The firm expects a Q4 2026 BTCUSD bottom.
Why the timing may extend: Only 4 of 13 bottom indicators have triggered so far. Stronger historical “bottom” confirmations—such as trading below cost basis, broad holder unrealized losses, sustained loss-taking, and capitulation flush—have not appeared. Galaxy notes Bitcoin has not fallen below its cost basis in this cycle, and the current MVRV low (~1.14) has stayed above past bottoms (which often went below 1.0).
Upcycle context: The October 2025 cycle top was unusually “calm” on several onchain measures (fewer classic top signals, lower MVRV peak vs prior cycles), which helped keep the market cost basis higher—so the old rule of a 75%–85% drop from cycle high may be outdated.
Traders should note market sensitivity: Galaxy’s model does not directly include macro/regulatory factors, but recent selloff drivers highlighted in the article (ETF outflows, risk-off pressures, leverage liquidations) can still accelerate downside if stress returns.
At the time of reporting, BTC was around $63.4K, above the $40K–$46K base-case zone, but within long-term support regions tracked by Galaxy.
Bearish
Galaxy’s Bitcoin cycle framework points to a lower base-case downside zone ($40K–$46K) while explicitly stating that only a minority of bottom indicators have triggered. Missing “hard confirmation” signals (below cost basis, capitulation-style flush, holder loss metrics) suggests the market may still be in an early-to-mid phase of the drawdown, which is typically associated with further volatility and potential retests before a durable bottom.
In the short term, traders may treat this as a risk-management prompt: rallies toward current levels (around the low-$60Ks) could face supply if ETF outflows or leverage-driven selling reappears. In the long run, the article’s emphasis on a Q4 2026 bottom and the “compressed” cycle behavior may support a more patient, phased accumulation strategy—rather than an immediate full risk-on position—until more bottom confirmation signals print.
Compared with prior cycles where more of the 13 bottom signals eventually lit up together, the current lack of those strongest indicators increases the probability that price must travel further (or linger longer) to complete the cycle pattern.