The Bitcoin Cycle Framework
Bitcoin moves in approximately 4-year cycles tied to its halving schedule. Each cycle has four phases that echo traditional Wyckoff market theory:
1. Accumulation (Bear Market Bottom): Price has fallen 75-85% from the previous peak. Smart money accumulates while retail investors are demoralized. On-chain indicators show coins moving from weak to strong hands. Duration: 6-12 months.
2. Markup (Early/Mid Bull Market): Price breaks above previous bear market resistance and enters a sustained uptrend. Media attention increases. New investors enter. Supply constraints from the halving begin to affect price. Duration: 12-18 months.
3. Distribution (Late Bull Market/Peak): Price reaches parabolic levels. Euphoria peaks. Early investors sell to latecomers. On-chain indicators show coins moving from long-term holders to short-term speculators. Duration: 2-6 months.
4. Markdown (Bear Market): Price declines sharply as euphoria fades. Leveraged positions are liquidated. Media turns negative. Capitulation events create the conditions for the next accumulation phase. Duration: 12-18 months.
Bitcoin Horizon's dashboard provides a composite view of where we are in the current cycle, using five independent indicators that each measure a different aspect of cycle position.
Power Law Model
The Power Law model fits a log-log regression to Bitcoin's price history, producing a fair value line with support and resistance bands.
What it measures: Long-term growth trajectory. The model captures Bitcoin's fundamental appreciation rate, which follows a power law (price grows as a function of time raised to a power).
How to read it: Price below the fair value line = undervalued (favorable for buying). Price at or near fair value = neutral. Price above fair value, approaching resistance = overvalued (caution).
Historical accuracy: The support band has never been broken in 15+ years. Price has always reverted to within the model's bands after excursions. The model has correctly identified every major cycle bottom and top zone.
Limitations: The model assumes continued adoption growth. If Bitcoin's adoption stalls or reverses, the model would break down. Returns are projected to decline over time as the market matures.
Explore the live chart on Bitcoin Horizon's Power Law page.
MVRV Z-Score, Pi Cycle Top & 2-Year MA
MVRV Z-Score: Compares market cap to the aggregate cost basis of all Bitcoin. Below 0 = extreme buying opportunity. Below 1 = favorable. 1-3 = neutral. Above 5 = extreme caution. The most reliable bottom indicator in Bitcoin's history.
Pi Cycle Top Indicator: Tracks the relationship between the 111-day and 350-day moving averages (multiplied by 2). When the shorter MA crosses above the longer, it has historically signaled a cycle top within days. This indicator has accurately called the 2013, 2017, and 2021 cycle peaks. It's a sell/caution signal, not a buy signal. When Pi Cycle is NOT in crossover, conditions are normal.
2-Year Moving Average Multiplier: Creates a channel between the 2-year moving average (lower bound) and its 5x multiplier (upper bound). Historically, buying below the 2-year MA has produced the best returns, while selling above the 5x multiplier has captured cycle peaks. This is one of the simplest and most effective indicators — easy to understand and consistently useful.
Each of these indicators is available as a dedicated page on Bitcoin Horizon with full interactive charts, zone highlighting, and historical data.
Mayer Multiple & Cycle Score
Mayer Multiple: Simply divides the current Bitcoin price by its 200-day moving average. A Mayer Multiple of 1.0 means price equals the 200-day average. Below 0.8 has historically been a strong buy zone (price more than 20% below trend). Above 2.4 has marked overbought conditions. The beauty of this indicator is its simplicity — it measures nothing more than how far price has deviated from its medium-term average.
Cycle Score (Bitcoin Horizon Composite): Rather than tracking five indicators separately, the Cycle Score combines Power Law, MVRV Z-Score, Pi Cycle, 2-Year MA, and Mayer Multiple into a single 0-100 reading. Scores below 30 = buy zone. 30-60 = neutral. Above 60 = caution. Above 80 = extreme overheating.
The Cycle Score weights indicators using a consensus approach — when most agree, the signal is strong. When they diverge, the score moves toward neutral. This automated multi-indicator analysis provides a quick summary for investors who want a single number to reference.
Bitcoin Horizon's dashboard displays the Cycle Score prominently alongside individual indicator cards, so you can see both the summary and the components at a glance.
Bottom line: No single indicator is perfect. The most reliable signals come from multiple indicators confirming the same condition. Use Bitcoin Horizon's tools to monitor all five and look for consensus — especially during critical market phases when decisions have the biggest impact on your returns.