Alex Thorn, head of firmwide research at Galaxy, says Bitcoin’s extended drawdown has likely ended, citing the cryptocurrency’s renewed hold above a long-term trend indicator that has historically limited its downside.

“We believe the bottom is in.”

That is the call from Thorn, who laid out his case in a segment on Bitcoin Magazine’s BMTV, arguing that Bitcoin’s most recent low is likely to hold.

The call hinges on the 50-week moving average. Bitcoin closed back above its 50-week moving average during the week of September 20 and has kept that trend in place since, according to Galaxy. The firm notes that in the four prior instances in which Bitcoin reclaimed the average after spending more than 20 weeks below it, the price never closed more than 8.4% under the reclaim level in the following year. That track record is the backbone of the call: Galaxy’s comparison set counts only reclaims that followed extended stretches — more than 20 weeks, or nearly five months — below the line, and in each of those four episodes no close in the following year came in more than 8.4% below the level Bitcoin regained. The current reclaim is the episode the firm is measuring against that narrow but specific history.

That framing also sets out what to track from here: because the pattern is defined by weekly closes, the key data point is Bitcoin’s weekly close relative to the 50-week average, and Galaxy’s historical comparison window runs a full year from the reclaim.

The 50-week moving average, calculated from roughly a year’s worth of weekly closing prices, is widely used by analysts as a gauge of Bitcoin’s long-term bull and bear cycles. Because it averages about a year of weekly closes, the line shifts gradually and is generally read as a filter for multi-month trend rather than short-term swings — which is why the pattern Galaxy describes turns on weekly closes rather than day-to-day price action. Galaxy, a digital asset financial services firm founded by Mike Novogratz, publishes ongoing research on digital asset markets through its firmwide research team, which Thorn leads.

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Source: Bitcoin Magazine