[Wenggou Original] Using mathematical methods to predict the peak price of Bitcoin in this bull market

With years of historical data, we can observe patterns from past bull cycles and thus become increasingly able to predict the current cycle. In this analysis, we take a deep dive into when the next Bitcoin peak might occur and at what price levels.

Pi Cycle

The Pi Cycle Top indicator is one of the most popular tools for analyzing Bitcoin cycles. The indicator monitors the 111-day and 350-day (times 2) moving averages, and when these two lines cross, it has historically been a reliable signal that Bitcoin has reached a cycle peak, with predictions usually ranging to just a few days. After these two levels separated for several months due to sideways price action, we are now starting to see the 111-day trend pick up again, with the two starting to close the gap.

We can use the Pi Cycle Tops and Bottom Indicator to measure the difference between the two averages to better define where Bitcoin is in its bull and bear cycles. The oscillator is trending upwards again, suggesting that Bitcoin’s next bull run could be imminent, similar to the 2016 and 2020 cycles.

Previous Bitcoin Cycles

Historically, Bitcoin bull cycles have shown similar phases: an initial rapid growth, a cool-off period, a second peak, and finally a sharp retracement followed by a new surge.

2016 Cycle: This cycle saw a first peak, a trough, a second peak, and then a full-blown bull run. This is very similar to the trend we are seeing now. The price of Bitcoin hit new highs after these two retracements.

2020–2021 Cycle: The pattern is slightly less distinct, but a similar trajectory is observed. Bitcoin’s price peaked twice, once during the initial surge and again at the peak of the bull run when BTC reached its all-time high.

Using the Bitcoin Magazine Pro API, we can simulate different growth scenarios based on past cycles. Since the Pi Cycle Top and Bottom Oscillators recently turned upward, we can overlay the oscillators’ rates of change in previous cycles to see potential routes for this cycle.

If the 2021 cycle repeats itself, the 111-day and 350-day moving averages could cross around June 29, 2025, meaning Bitcoin could peak. If the 2017 cycle repeats itself, the moving averages might not cross until January 28, 2026, meaning the peak would come much later.

Price Prediction

Using these methods, we can also try to estimate potential price levels. Historically, the price of Bitcoin has greatly exceeded its moving averages at peaks. During the 2017 bull run, the price of Bitcoin was three times the value of these moving averages at its peak. However, as the market matures, we see diminishing returns with each cycle, meaning that the price of Bitcoin may not rise as much relative to its moving averages as it has historically.

If Bitcoin follows a similar pattern to the 2021 cycle, rising about 40% above its moving average, Bitcoin would peak at about $339,000. Assuming diminishing returns, Bitcoin's price would likely only rise about 20% above its moving average. In this case, the peak price would be closer to $200,000 by mid-2025.

Likewise, if the extended cycle of 2017 repeats with diminishing returns, Bitcoin could peak at $466,000 in early 2026, while more modest growth could result in a peak price around $388,000. While it’s unlikely that Bitcoin will reach $1 million during this cycle, these more modest projections could still represent substantial gains.

in conclusion

While these forecasts use reliable data, they are not guaranteed to be accurate. Each cycle has its own unique dynamics, influenced by economic conditions, investor sentiment, and regulatory changes. Diminishing returns and even potentially extended cycles are possible, reflecting the maturity of the Bitcoin market.