Viewpoint: A bull market is like sex, it feels best before it ends
The 4-year cycle suggests that a macro peak may occur in 2025.Author: Crypto, Distilled
Compiled by: Shenchao TechFlow
The biggest trick of the market is to make everyone think it's all over before the real fun begins.
"A bull market is like sex; it feels best just before it ends." ------ Warren Buffett.
Here are 7 reasons why the most interesting phase has yet to begin.
The Biggest Trick of the Market
Before diving into these reasons, let's first understand the background.
The biggest trick of the market is to make people think the fun is over before it begins, caused by what is known as the "Wall of Worry."
What is the Wall of Worry?
During a bull market, the market rises along a wall built of worry and doubt.
Every piece of pessimistic news adds a brick to this wall, and this tough battle determines the nature of the bull market, while worry fuels the price increase.
Building a High Wall of Worry
Moderate FUD (Fear, Uncertainty, and Doubt) is healthy in a bull market. It keeps some people on the sidelines, and once skeptics turn into believers, it provides momentum for the market rebound.
Despite $BTC nearing all-time highs, doubts about consumer crypto applications, global liquidity, $ETH ETFs, and altcoins still persist.
The Biggest Opportunities
How to profit from this? Stay calm during uncertain times; panic only narrows your vision.
Facing danger calmly allows us to assess the situation and discover potential opportunities.
Now, let's delve into these 7 reasons.
1.
#### More Liquidity is Coming
One of the main reasons the cycle peak may not have arrived yet is liquidity.
With global macro policies easing, liquidity is expected to surge in 2025.
An increase in the flow of funds typically drives up cryptocurrency prices.
2.
#### The Market Ends Abruptly
The last stages of previous bull markets have shown a clear parabolic shape.
While history does not repeat itself exactly, there are often similarities, and we have not yet seen such a climax.
According to @Grayscale, only about 30% of altcoins have risen this year.
3.
#### The "Banana Zone" Pattern
The "Banana Zone" refers to periods when asset prices soar, reliably observed in past cycles.
This phenomenon is driven by a 4-year global liquidity cycle since 2008, typically peaking in the fall.
Currently, we are in the summer phase.
(Thanks to @RaoulGMI)
4.
#### Post-Halving Performance
Bitcoin's post-halving performance indicates there is still more upside potential.
Historical data shows that macro peaks usually occur about 200 days after the halving.
Currently, post-halving volatility is normal.
(Thanks to @RaoulGMI)
5.
#### Four-Year Cycle Theory
The four-year cycle is like astrology for cryptocurrencies; it may simply be influenced by global liquidity cycles and election seasons on the market.
If history repeats, a peak is expected around October 2025 (approximately 16-17 months from now).
(Thanks to @BobLoukas)
6.
#### The Premature Signal Fallacy
Due to the presence of more "premature signals" in the cryptocurrency market, signals for each cycle seem to arrive earlier.
This makes it easy for people to mistakenly believe the cycle has ended when, in fact, the new phase has not yet begun.
New phases typically bloom later in the cycle, accompanied by experimentation and optimism.
(Note: "The Premature Signal Fallacy" refers to the phenomenon in the cryptocurrency market where early signals appear increasingly sooner, leading people to mistakenly believe that the market cycle has ended, while in reality, a new market phase has not yet begun. This phenomenon can cause investors to miss late-stage market opportunities because they prematurely assume the market has peaked or is about to decline.)
7.
#### Extremely Low Social Risk
The most interesting and dangerous times in the market are usually accompanied by extreme euphoria.
In the first half of 2024, the market's social risk is very low—it's not overheated but rather appears unusually quiet.
Currently, retail investors show almost no interest in altcoins.
(Thanks to @intocryptoverse)
Conclusion
The last stage of a bull market is usually the most intense rise.
The Wall of Worry can make people mistakenly believe the bull market has ended.
Liquidity is expected to rise; is the Banana Zone approaching?
The four-year cycle suggests a macro peak may occur in 2025.
Purely educational content, not financial advice.
