Bitcoin Momentum Reset: Path to Next Bull Cycle

Bitcoin’s market dynamics are currently experiencing what analysts describe as a full momentum reset, a phenomenon that typically emerges during the cooling phase between major trend cycles. According to Swissblock, this reset phase represents a period where previous directional force has largely dissipated, allowing for a fundamental re-evaluation of Bitcoin’s path forward. The current reset has been underway for several weeks, placing BTC squarely within the historical window where past cycles have typically reached exhaustion.

Historical data reveals distinct patterns in Bitcoin’s momentum resets. In late February to early April 2025, the bottom required approximately 7 weeks for a complete momentum reset. Looking further back to late June through late September 2024, the correction took nearly 14 weeks for full reset and consolidation before a clear trend re-emerged. This historical context provides crucial benchmarks for understanding the current market phase, where downside pressure typically weakens and the probability of a counter-trend move increases significantly.

The current Bitcoin correction began from a position of strength, with the cryptocurrency touching an all-time high of $126,272 on October 6th, according to The Kobeissi Letter. The total crypto market capitalization had reached $2.5 trillion, signaling robust market confidence. However, this bullish trajectory was abruptly interrupted on October 10th when President Donald Trump threatened 100% tariffs on China, fundamentally shifting the crypto market landscape.

The political announcement triggered an unprecedented chain reaction, resulting in a record $19.2 billion in liquidations—the highest ever recorded in a single market event. Bitcoin never truly recovered from this shock, despite a subsequent trade deal between the United States and China reached on October 30th. Instead of stabilizing, liquidation pressures intensified, with BTC price action moving into a literal straight line lower since November 10th and average daily liquidations approaching $1 billion.

Throughout this 45-day bear market, The Kobeissi Letter notes a significant absence of bearish fundamental developments within the crypto space itself. This observation points to what analysts characterize as a mechanical bear market—one driven primarily by excessive leverage and sporadic liquidations rather than underlying weakness in cryptocurrency fundamentals. The market’s efficiency, according to this analysis, suggests it will naturally iron itself out as leverage unwinds.

Daan Crypto Trades, a full-time crypto trader and investor, highlights that while each correction in the current cycle has its own narrative, this particular downturn has hit the market hardest. The October 10th liquidation event didn’t just impact Bitcoin—it obliterated altcoins across the board. Notably, during most of this brutal BTC correction, traditional assets like equities and metals were making fresh all-time highs, further emphasizing the isolated nature of the crypto market’s bearish condition.

The current Bitcoin correction aligns perfectly with previous major drawdowns in this cycle, following established historical patterns. Swissblock’s analysis indicates that momentum resets typically last between 7-14 weeks, placing the current correction within the expected timeframe for market exhaustion and potential reversal. This pattern suggests that the market is approaching a critical juncture where historical precedent indicates increased likelihood of trend reversal.

Market efficiency appears to be playing out as predicted by analysts, with the mechanical nature of this bear market creating conditions for natural correction. The absence of fundamental crypto weaknesses, combined with the historical precedent of momentum resets preceding significant upward moves, suggests Bitcoin may emerge stronger from this test. As past cycles have demonstrated, these reset phases often serve as necessary consolidation periods before the next major bullish impulse.