Down 34% From Its Highs, Is Bitcoin a Buy Right Now?

Bitcoin (CRYPTO: BTC) is still down 34% from its all-time high of $126,000 from last October. But it's getting very hard to ignore its stunning reversal over the past two months. In July, Bitcoin dipped below $60,000. Today, it's trading near $85,000.

That leads me to think that Bitcoin could be ready to regain the $100,000 price level by the end of this year. In 2027, it could hit a new all-time high if the momentum continues.

The Bitcoin 4-year cycle

The key to understanding Bitcoin has always been its 4-year boom-and-bust cycle. Long story short, three good years are typically followed by an epic collapse in year four. Then, the cycle begins anew, and Bitcoin races to another all-time high.

Image source: Getty Images.

If the 4-year cycle is still relevant, Bitcoin may already have bottomed. Back in July, Coinbase Global (NASDAQ: COIN) CEO Brian Armstrong called a bottom in Bitcoin. That was when Bitcoin briefly dipped below $60,000.

As soon as the calendar flips to October, it will be almost exactly 12 months to the day that Bitcoin crested at $126,000. That means the one year of "epic collapse" is thankfully coming to a close. It's setting up Bitcoin for a massive rally in 2027 and an even bigger rally in 2028 when the next Bitcoin halving takes place. Historically, these halving events have been the kickoff for massive Bitcoin rallies.

But what about the catalysts for Bitcoin?

That being said, it's hard to name a specific catalyst for Bitcoin right now. The Clarity Act failed, interest rates are going up, and uncertainty continues to hang over the U.S. economy. Those don't seem to augur well for a massive crypto rebound.

Or do they? Bitcoin has historically been uncorrelated with any major asset class and now appears to be decoupling from stocks. From this perspective, all the macroeconomic uncertainty hanging over the U.S. economy might actually become a new catalyst for Bitcoin if it convinces investors to move their money out of dollar-denominated assets.

After all, is there any possible way that a $40 trillion debt load can be good for the U.S. economy? The only way to pay off that debt is by printing more dollars. No wonder money is once again moving into gold, and traders are once again talking about the "debasement trade" (i.e., moving out of dollars and into Bitcoin and precious metals).

Moreover, Bitcoin recently reclaimed its 365-day moving average of $80,500. In the past, this has typically signaled the start of a new Bitcoin bull market cycle.

The bulls are in control right now, not the bears. Market sentiment has flipped, and investors are more bullish on crypto than at any time since December 2024. That sets up nicely for Bitcoin, which could be headed to $100,000 by the end of this year. At a price of just $85,000, it's a screaming buy right now.

Dominic Basulto has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.