"May Sell-Off" historical pattern repeating? Review of May declines during the 2018/2022 midterm election years

Cryptocurrency Market Entry in Mid-May 2026, the controversy surrounding the traditional financial market seasonal saying “Sell in May and go away” heats up again. Historical data shows that in May of 2018 and 2022, during mid-term election years, Bitcoin experienced significant pullbacks of about 30% and 70%, respectively. Whether this pattern will repeat in 2026 has become one of the most debated topics in the current market.

What are the sample characteristics of the May pullbacks in mid-term election years

In May 2018, Bitcoin’s price declined from around $9,200 at the start of the month, repeatedly breaking key round-number levels. After falling below $8,000 on May 23, selling pressure persisted, and by May 27, the price dipped to around $7,270, hitting a new low in a month and a half. The overall decline that month was about 19%, but the true trend reversal occurred in June—Bitcoin further dropped and first fell below $6,000, reaching a new low of $5,827 for the year. This meant that in this cycle, May was not only the start of a correction but also a confirmation signal of a bear market continuation.

The pullback in May 2022 was even more intense, triggered by clearly event-driven factors. The de-pegging of TerraUSD (UST) algorithmic stablecoin caused a spiral collapse of LUNA, rapidly transmitting to the entire crypto market. On May 12, Bitcoin’s price plummeted within a single day, bottoming out at about $25,000, roughly halving from the year’s high. By May 26, Bitcoin’s decline for the month had reached approximately 27%, and combined with the continued weakness in April, the entire second quarter became one of the most brutal quarters in crypto market history.

There are clear differences between the two samples: the 2018 pullback was mainly due to systemic pressures from tightening regulation and macro liquidity contraction, while the 2022 crash was triggered by structural vulnerabilities in specific projects, characterized by suddenness and extremity. Yet, the coincidence in timing still raises market caution regarding the May period in election years.

Is “Sell in May” statistically significant in the crypto market

In traditional finance, the “Sell in May and go away” strategy originates from seasonal observations that US stocks perform worse from May to October compared to winter and spring. However, its applicability to the crypto market has been controversial.

Long-term data shows that Bitcoin’s performance in May does not exhibit a stable seasonal bias. Studies from 2011 onward find that May’s average return is about 22.1%, ranking among the top months of the year. Another retrospective analysis of nearly 8 years of data indicates that the probability of a decline in May closing prices is exactly 50%, consistent with random fluctuations.

This suggests that “Sell in May” is not an iron law in crypto but more of a cognitive label. The truly valuable insight is not May itself but the specific cycle node of mid-term election years—when seasonal narratives combine with structural macro pressures, market sentiment resonance can be significantly amplified. This explains why the current debate is not whether May “should” decline but rather how probable and how large the decline might be in 2026 under the specific environment.

How will tariff escalation in 2026 affect crypto market liquidity

Compared to 2018 and 2022, the macro environment in 2026 introduces a key new variable—the substantial escalation of global tariff conflicts. In February 2026, the U.S. government announced a 15% baseline tariff on global imports, combined with previous additional tariffs on Chinese goods, with some categories reaching a total tax rate of up to 145%.

Tariff shocks propagate into the crypto market via two channels. First, tariffs increase the cost of imported goods, intensifying inflationary pressures, forcing the Federal Reserve to maintain higher interest rates. In a high-rate environment, market risk appetite systematically declines, and crypto assets, as high-beta risk assets, are among the first to be affected. Second, tariff policy uncertainty directly impacts the hardware supply chain for mining—import costs for mining equipment rise sharply, squeezing cash flow for small and medium miners. As of May 18, 2026, Bitcoin was quoted around $76,000 on Gate.io, a significant pullback from the all-time high of $125k in 2025.

However, some argue that the rebalancing of global trade driven by tariffs could be medium-term positive for the crypto market’s structural narrative. Emerging markets facing currency depreciation and capital controls may increasingly view Bitcoin as “digital gold,” which is one of the deep reasons behind current market bullish-bearish divides.

What signals do on-chain data and miner behavior convey

On-chain data offers an objective perspective on seller pressure. In Q1 2026, listed mining companies sold nearly 32,000 BTC, exceeding the total amount they reduced holdings in all of 2025. This selling pressure is directly caused by the increased unit production costs after Bitcoin’s 2024 halving, while prices did not rise proportionally, leading to sustained shrinking profit margins. Some miners were forced to sell reserves to maintain liquidity, continuously supplying the market with sell-side pressure.

But the other side of on-chain data is equally noteworthy. The market has absorbed miner sell-offs in the $76,000–$80,000 range without signs of liquidity exhaustion. Meanwhile, total miner reserves have been increasing since late April, with some miners choosing to hold rather than continue selling after prices stabilized. This indicates that the market is not simply facing excess supply but is undergoing a dynamic game between supply and demand. If demand weakens marginally in the coming weeks, current price levels could be tested.

Where do analyst disagreements mainly lie

As of May 18, 2026, market analysts show clear divergence in their views on May’s trend. Merlijn Enkelaar believes history is highly repetitive; the current cycle’s structural features resemble those of 2018 and 2022, and if history repeats, BTC could fall back to around $33,000. João Wedson, CEO of Alphractal, states that if BTC remains below $78,000, the probability of a new capitulation sell-off will increase significantly.

Opposing analysts argue that the market structure in 2026 differs fundamentally from previous cycles. The passage of the CLARITY Act in the U.S. provides a clearer regulatory framework for the crypto industry, which was not present in 2018 and 2022. Additionally, the inflow channels for spot Bitcoin ETFs have been established, with institutional participation far higher than in previous cycles, potentially providing stronger support during downturns.

The core of the disagreement is essentially a clash between two analytical frameworks: one based on time series pattern extrapolation, expecting high repeatability, and the other based on structural variable changes, focusing on fundamental shifts. The former asks “what has happened before,” while the latter asks “what is different this time.”

How to define key support levels and technical structure

From a technical perspective, the $64,000–$65,000 zone formed in Q1 2026 is one of the most critical support levels. During the rapid decline triggered by the tariff shock in late February, this zone experienced concentrated volume tests and was ultimately confirmed as a support level. If a pullback occurs in late May, this area will be key to observing whether selling momentum exhausts.

On the resistance side, $78,000–$80,000 is the region of the April high, also a consensus key threshold among many analysts. João Wedson considers $78,000 as the critical line for determining whether a new wave of selling begins—sustained below this level indicates a weak market structure. Conversely, if prices can recover and stabilize above $80,000, the bearish pressure from the May sell-off narrative could be alleviated.

It should be noted that technical support levels are not absolute boundaries that cannot be broken but are reference points for risk-reward assessment and decision-making frameworks. In actual trading, these should be dynamically adjusted based on on-chain data and volume changes.

How miner reserves and demand-side dynamics evolve

Miner behavior is not static and can change over time. After the concentrated sell-off in Q1 2026, the behavior of miners has become more differentiated: some listed companies continue to reduce holdings for financial disclosure and cash flow management reasons, while others choose to accumulate reserves at current prices. This divergence suggests that the peak of seller supply may have passed.

The market’s ability to absorb future miner output depends on demand resilience. Post-halving in 2024, the daily new supply of Bitcoin has fallen to about 450 BTC, while the daily net inflow into spot ETFs in Q1 2026 averaged over 1,500 BTC. Even considering miner sell-offs and long-term holders, current demand levels still have capacity to absorb supply. However, if macro risk events trigger widespread risk-off sentiment, demand could rapidly contract, breaking this balance.

Looking at a longer cycle, miner reserves have risen to around 1.8 million BTC, indicating ongoing structural tightening on the supply side. The gradual weakening of seller pressure provides underlying support for price stabilization, but this process requires time to create space.

Summary

In mid-term election years, the historical pullbacks in May were about 30% in 2018 and 70% in 2022, but the underlying triggers differ fundamentally—regulatory and macro liquidity contraction in 2018, and a structural black swan event with the collapse of stablecoins in 2022. The macro environment in 2026 introduces a new variable—tariff escalation—that exerts systemic pressure on risk assets, but regulatory improvements and institutional capital channels also provide structural support.

Analysts are sharply divided on whether the historical pattern will recur, focusing on either the continuation of time series regularities or structural changes. On-chain data shows miner sell-off pressure is marginally easing, but resistance above $78,000, if not突破, could still pose a downside risk.

For market participants, rather than trying to predict whether “Sell in May” will necessarily happen, it is better to establish observable monitoring frameworks—paying attention to volume changes in the $64,000–$65,000 support zone, the monthly net change in miner reserves, and the latest developments in tariff policies—combining these with personal risk tolerance to formulate strategies.

FAQ

Q: What is the “Sell in May” strategy, and is it effective in the crypto market?

“Sell in May” originates from seasonal observations in traditional stocks, indicating that the market from May to October tends to underperform compared to winter and spring. However, in crypto markets, historical data shows that May’s average return ranks among the top months of the year, making this strategy statistically less significant. More importantly, focus should be on the mid-term election cycle—when seasonal narratives combine with macro pressures, amplifying market sentiment resonance.

Q: How much did Bitcoin fall in May 2018 and 2022?

In May 2018, Bitcoin declined about 19%, but the trend reversed in June, with prices further dropping to a low of $5,827. In May 2022, amid the Terra collapse, Bitcoin fell approximately 27%, and after April’s correction, it was nearly halved from the high.

Q: What are the main points of disagreement among analysts about future trends?

Disagreements mainly revolve around two frameworks: one based on historical time series patterns, expecting high repeatability with Bitcoin potentially falling to around $33,000; the other based on structural changes, such as regulatory improvements and institutional participation, which suggest a lower probability of extreme declines.

Q: What key price levels should the market watch now?

The primary support zone is $64,000–$65,000, tested during the Q1 volume concentration. The key resistance area is $78,000–$80,000, with sustained trading below indicating a weak market structure.

Q: Will miner sell-offs impact the market?

After the approximately 32,000 BTC sold in Q1 2026, seller pressure appears to be marginally decreasing, with miner reserves showing signs of replenishment. Whether sustained selling occurs depends on the relationship between Bitcoin’s price and miners’ costs.