Despite Bitcoin's recent surge of nearly 15% this month, some experts remain unconvinced that the largest cryptocurrency has overcome the bear market that began in October, given it still lingers 40% below its record high. Some forecasters predict a significant drop to as low as $40,000, a 70% decline from its all-time peak. According to Bitcoin analyst James Check, such a move, although not impossible, would be statistically remarkable.
Check referenced the Bitcoin Mean Reversion Index, which combines multiple valuation metrics, including the 200-week moving average and realized price, to rank Bitcoin's price on a historical percentile basis. At $40,000, Bitcoin would register as a '0.4 event,' placing it in the 0.4th percentile of all daily closes, below any meaningful deviation across major anchors. For perspective, Check notes this would be equivalent to Bitcoin trading below $2 in 2011 on a relative basis.
Currently, the price sits around the 31.5th percentile, historically weak but within normal correction ranges. Check emphasizes that while no event has zero probability in markets, a drop to $40,000 would be a nearly unprecedented outcome.