Bitcoin Surpasses a Crucial Moving Average That Ended Four Prior Bear Markets, Yet a Historical Trap Threatens a Plunge to $62,000

Bitcoin reached an intraday peak exceeding $82,000 on September 3, surging past the 50-week moving average. According to Galaxy Research, this threshold has historically marked the definitive end of four out of five comparable bear markets.

However, Galaxy’s framework requires a weekly closing price above this threshold to confirm the signal. The September 3 intraday spike occurred well before the week’s close, leaving the signal unconfirmed.

A Historical Precedent With a Notable Exception

In Galaxy’s model, the 200-week moving average serves as Bitcoin’s historical bear market floor, while the 50-week moving average acts as its ceiling, currently hovering near $81,800.

Across four of the five completed bear markets where Bitcoin dipped below this ceiling, the first successful weekly recovery signaled the ultimate bottom.

The notable exception occurred in 2021 and 2022, when Bitcoin briefly reclaimed the level on two separate occasions before plummeting to a new low.

Galaxy’s drawdown metrics place the current bear market’s inception near the October 2025 peak of $124,800, with its trough near $58,500 in late June, representing a decline of approximately 53%.

More Than a Technical Pattern

Research from Bitwise published on September 1 posits that Bitcoin’s reclaimed price levels, when combined with its Long-Term Holder Supply and Risk-On Transition models, suggest a new bull market cycle is already underway, contingent upon those reclaimed levels holding firm.

This convergence broadens the bullish argument beyond a single technical crossover.

CryptoQuant analyst Darkfost noted on September 2 that Bitcoin’s apparent demand—a metric gauging whether fresh buying is absorbing newly available supply—briefly dipped negative again after a short-lived recovery earlier in August faded.

During that same period, wallets holding over 100 BTC accumulated roughly 60,000 BTC even as smaller holders divested, while Glassnode data indicates that genuine spot participation and ETF inflows underpinned the rally’s early stages.

While the buyer base is genuine, it has yet to expand sufficiently to absorb sellers as prices continue to ascend.

Multiple Metrics Converge on the Same Price Band

Glassnode’s recent on-chain analysis identifies the $83,000 to $86,000 range as a dense cluster of long-term-holder supply, marking the level where the current relief rally has stalled.

At these price levels, 68% of Bitcoin’s supply is currently in profit, up from 65% during a similar test in May, suggesting an increased likelihood of coins being sold into further strength.

21Shares defines the $81,000 to $82,000 range as the dividing line between a genuine upward turn and a standard bear market bounce, with $85,000 and eventually $98,000 as the subsequent targets above it.

Although none of these frameworks arrived at identical figures through the same methodologies, Galaxy’s moving average, Glassnode’s supply data, and 21Shares’ regime band independently cluster within the broad $81,000 to $86,000 zone, presenting a compelling convergence.

The Rally’s Origins Warrant a Closer Examination

Glassnode traces the current rally to a short squeeze in mid-August that propelled Bitcoin from roughly $63,500 toward $80,000.

This ascent occurred alongside approximately $2.8 billion in ETF inflows, declining futures open interest, and contained funding rates—a pattern more indicative of spot buying and short covering than leveraged longs chasing the market.

While ETF inflows later peaked near $290 million daily, secondary-market turnover for those funds remained closer to $3 billion daily, a more subdued pace than previous expansion phases.

The Treasury’s August 19 decision to at least double its long-end liquidity-support buybacks also contributed to the initial momentum.

QCP has warned that such operations function as liquidity support rather than comprehensive monetary easing, while Fed Governor Christopher Waller has highlighted fiscal strains keeping Treasury yields elevated in the high-4% range.

Bitcoin must secure a weekly close above the 50-week moving average, as Galaxy’s historical signal has never been satisfied by an intraday spike alone.

Furthermore, it must clear and sustain the $83,000 to $86,000 range, genuinely absorbing the long-term-holder supply identified by Glassnode over a sustained period.

Apparent demand, ETF flows, and US spot activity must independently turn convincingly positive, surpassing the mixed readings observed thus far.

The reclaimed levels must also withstand the profit-taking that ensues as more of the supply moves into profitable territory.

Whether the Reclaim Holds or Mirrors the 2021-22 Exception

The bullish scenario requires Bitcoin to close the week above the 50-week moving average and subsequently clear the $83,000 to $86,000 zone on spot demand robust enough to push through the level where Glassnode notes the current relief rally has stalled.

Under this trajectory, $90,000 would come into view, followed by the prior 2026 high near $98,000. Galaxy’s historical signal would align with its four successful predecessors, leaving the 2021-22 episode as the sole exception on record.

Conversely, the bearish scenario involves Bitcoin failing the weekly close entirely or losing support near $76,000 to $78,000. This would trigger a slide toward $71,800 and eventually the $62,000 to $65,000 zone that served as the accumulation base beneath this year’s rally.

In that event, the 2021-22 exception would find a companion, and the August rally would retrospectively be viewed as forced short covering that exhausted itself once genuine demand failed to materialize.

Bitcoin has crossed the threshold that has historically marked the end of its bear markets. The coming days will determine whether sufficient buyer participation has arrived to validate the move.

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