I just reviewed Doctor Profit's analysis of the Bitcoin price action framework and found it very interesting how he maps out market cycles. The guy developed this six-stage model by observing Bitcoin's historical behavior in bull and bear markets, and according to him, we are now in Stage 4.

This stage is basically that boring market moment, you know? It’s not very volatile, but it’s exhausting. Bitcoin moves sideways, creating liquidity, while we see that market dehydration and a certain depression in sentiment. Nothing too dramatic, but really tiring.

The framework starts at Stage 1 with that euphoric market, then moves to Stage 2 with a quick drop, followed by Stage 3 that brutally confirms the bear market. We are in Stage 4 now, and according to Doctor Profit, soon we will enter Stage 5, the one marked by fear and capitulation. In this scenario, he projects that Bitcoin could fall to the range of $35,000 to $40,000.

What’s interesting about this price action model is how it suggests that after capitulation comes Stage 6, where we have stabilization and structural reversal. That’s where the foundations for the next bull cycle begin to form. Currently, BTC is trading around $78,420, and the question remains: will we really see that drop that Doctor Profit projects before entering a new upward momentum? In any case, understanding these stages helps better contextualize where we are in the cycle.