Wintermute says bitcoin bull market still in early stage; watch $82,000 and $72,000

Some investors who think they missed the entry point after bitcoin’s sharp rise may instead miss the early phase of a new bull cycle, blockchain outlet U.Today reported on Monday.

Crypto market maker Wintermute said in a recent report that the current trend is not the end of the rally but a phase preparing for the next move.

Wintermute said strong U.S. jobs data recently weighed on broader financial markets, but cryptocurrencies showed more resilience than expected. Markets priced the probability of further Federal Reserve rate hikes at around 60 percent, while gold, Treasuries and technology stocks weakened. Bitcoin also slipped from $82,400 to below $80,000 at one point, but soon erased all of the drop and ended the week up 3.45 percent.

Wintermute pointed to mounting fatigue in the stock market as a backdrop to the move. It said investors are taking profits after a long-running artificial intelligence-related rally, and that the money is moving into bitcoin and ether. It said cryptocurrencies are rising not alongside stocks but amid stock weakness.

On calls for a correction, it stressed a structure different from previous cycles. Some in the market say prices are already high and investors should wait for a sharp drop, but Wintermute said this cycle is fundamentally different. About 340 days after the all-time high, bitcoin in the 2018 and 2022 crisis phases had already fallen more than 75 percent, but this time the maximum drawdown is about 50 percent, it said. Wintermute assessed that each cycle’s low is becoming progressively shallower.