Compiled by: Vernacular Blockchain

It's always fascinating to see how market sentiment shifts. Just when everyone on Crypto Twitter was enthusiastically bullish on ETH, many suddenly turned bearish overnight. I wanted to share some market thoughts and discuss what might happen next. Let's zoom out and look at the data.

Historical background

Below is a chart of BTC’s price performance during past bull cycles:

By studying past cycles, you’ll find that the timing of BTC cycle tops is very consistent:

• In 2021, BTC peaked in November 2021
• In 2017, BTC peaked in December 2017
• In 2013, BTC peaked in December 2013

The peak of each cycle occurs in the fourth quarter (Q4) after the halving (2013, 2017, 2021, and now 2025).

Another interesting observation is that while September is typically one of Bitcoin’s weakest months, October has historically been one of its strongest.

While many are panicking over the recent decline, the market correction at the end of Q3 (September) is not uncommon and even consistent with past events. Does this mean this cycle will be identical to previous ones? Of course not. But while history doesn't repeat itself, it often shares similarities.

I have mixed feelings about September as it historically performs poorly, but based on experience from previous cycles, I believe Q4 will be a good quarter for the cryptocurrency market as the final stages of a bull cycle usually see significant gains.

Besides seasonality, the following factors make me bullish for Q4:

1. An interest rate cut is coming (for real this time)

Let's step outside of crypto for a moment and look at the macro economy. According to Polymarket, there's a 64% chance the Federal Reserve will cut interest rates in September. Why is this important?

Because when central banks lower interest rates, borrowing costs fall, and lower bond yields drive investors toward riskier assets, such as cryptocurrencies. Historically, significant rate cuts have been bullish for risky assets like cryptocurrencies.

2. Cryptocurrency companies continue to buy heavily

The data is shocking. According to https://www.strategicethreserve.xyz/, over 532,000 ETH (currently worth over $2 billion) was purchased by cryptocurrency companies through their asset reserves last week alone.

It should be noted that the collateralized Ethereum ETF has not yet been approved.

$2 billion in weekly buying pressure is a huge tailwind for ETH and other tokens. While these companies may eventually run out of money, I believe the top of this bull run has not yet been reached given the current inflow of funds.

3. The top signal has not yet fully appeared

The recent four-year high in searches for "crypto" and Jim Cramer's bullish turn led me to take some small profits earlier this week. However, other than that, the other "top signals" mentioned last week have yet to materialize. For example:

Coinbase's App Store ranking is still outside the top 200, while it was at the top of the App Store in the last cycle.

The Fear and Greed Index still looks healthy. Despite the recent market rally, it has not yet reached extreme levels of mania.

Although ETH has seen significant gains in the past few weeks, a short-term pullback is normal, but unless this is the worst cycle ever, I don’t think the fun is over yet.

My positioning strategy

As mentioned above, historically the best time to buy after halving is usually the end of September of the second year after the halving (the last halving occurred in 2024), because October is usually a strong month for BTC.

That's exactly my plan.

Based on the popular narratives at the end of September, I will select some popular tokens at that time and increase my holdings during the sharp decline to prepare for Q4. If there is no major pullback, I will continue to hold my existing positions. Then, I plan to gradually take profits in Q4 and significantly reduce my cryptocurrency exposure by the end of the year (assuming all goes as expected).

That’s my plan right now.

But remember, this is a game of probability and things can change drastically in a few months. As investors/traders, our task is to constantly adjust our strategies based on new information.

My advice is: build your own investment thesis based on your expectations. But no matter what you think will happen in the coming months, risk management should always be the top priority.

I have said many times: the hardest thing is not to make money, but to keep the money you earn.

Link to this article: https://www.hellobtc.com/kp/du/08/6008.html

Source: https://www.thedefinvestor.com/p/where-are-we-in-the-cycle-2bf