Predicting the peak price of Bitcoin in this bull market using mathematical methods

With years of historical data, we can observe patterns from past bull market cycles, thereby becoming increasingly capable of predicting the current cycle. In this analysis, we delve into when the next Bitcoin peak might occur and what price levels could be expected.

Pi Cycle

The Pi Cycle Top indicator is one of the most popular tools for analyzing Bitcoin cycles. This indicator monitors the 111-day and 350-day (multiplied by 2) moving averages, and historically, when these two lines cross, it has been a reliable signal for Bitcoin reaching a cycle peak, with the prediction range typically within just a few days. Due to the sideways price action, these two levels have been apart for months, and we are now beginning to see the 111-day trend rise again, with both lines starting to narrow the gap.

The Pi Cycle Top indicator 111DMA has begun to trend upwards.

We can use the Pi Cycle Top and Bottom indicators to measure the difference between the two averages to better define Bitcoin's position in bull and bear market cycles. This oscillation indicator is trending upwards again, suggesting that the next round of a Bitcoin bull market may be approaching, similar to the cycles of 2016 and 2020.

The Pi Cycle Top and Bottom indicators have ended their downward trend.

Previous Bitcoin Cycles

Historically, Bitcoin's bull market cycles exhibit similar phases: an initial rapid growth, a cooling period, a second peak, followed by a significant pullback, and then a new surge.

2016 Cycle: This cycle experienced the first peak, a trough, a second peak, and then a full bull market. This is very similar to the trend we are currently observing. Bitcoin's price reached new highs after these two pullbacks.

2020-2021 Cycle: The pattern is slightly less obvious, but a similar trajectory was observed. Bitcoin's price reached two peaks, one during the initial surge and the other during the bull market peak when BTC reached its all-time high.

Using the Bitcoin Magazine Pro API, we can simulate different growth scenarios based on past cycles. As the Pi Cycle Top and Bottom oscillators have recently turned upwards, we can overlay the oscillators' rates of change from previous cycles to see the potential path for this cycle.

Oscillator and 111DMA predictions based on historical rates of change.

If the 2021 cycle repeats, the 111-day and 350-day moving averages may cross around June 29, 2025, indicating that Bitcoin could peak. If the 2017 cycle repeats, the moving averages may not cross until January 28, 2026, suggesting a later peak.

Price Predictions

Using these methods, we can also attempt to estimate potential price levels. Historically, Bitcoin's price has significantly exceeded the moving averages during peak periods. During the 2017 bull market, Bitcoin's price was three times the value of these moving averages at its peak. However, as the market matures, we see diminishing returns in each cycle, suggesting that Bitcoin's price may not rise as significantly relative to its moving averages as it has in the past.

Potential targets for BTC in this cycle based on previous cycles.

If Bitcoin follows a pattern similar to the 2021 cycle and rises about 40% above its moving averages, the peak could reach around $339,000. Assuming diminishing returns, Bitcoin's price might only rise about 20% above its moving averages. In this case, the peak price could approach $200,000 by mid-2025.

Similarly, if the extended cycle of 2017 repeats with diminishing returns, Bitcoin could peak at $466,000 in early 2026, while more moderate growth might lead to a peak price around $388,000. While it is unlikely that Bitcoin will reach $1 million in this cycle, these more moderate predictions could still represent substantial gains.

Conclusion

While these predictions are based on reliable data, they do not guarantee accuracy. Each cycle has its unique dynamics, influenced by economic conditions, investor sentiment, and regulatory changes. Diminishing returns and even prolonged cycles are possible, reflecting the maturation of the Bitcoin market.