Alex Thorn, Head of Firmwide Research at Galaxy, stated that Bitcoin’s recent recovery above its 50-week moving average suggests the largest cryptocurrency has established a market bottom. Thorn highlighted that, historically, Bitcoin has never dropped to new cycle lows after regaining this technical level following an extended period below it.
Bitcoin regains key technical level
Galaxy’s latest research note begins with a direct statement: “We believe the bottom is in.” Thorn emphasized the significance of Bitcoin regaining the 50-week moving average after spending more than 20 consecutive weeks below this level. Based on historical records, he said this pattern has not been followed by a lower low in previous cycles, strengthening the view that Bitcoin’s recent bottom will hold.
Regaining the 50-week moving average after over 20 weeks below it has never resulted in a new cycle low for Bitcoin, according to Alex Thorn. He explained that this key level has historically marked the start of significant price recoveries, adding, “We believe the bottom is in.”
At the time, Bitcoin was trading around $81,000 after the Federal Reserve’s latest announcement, a level described by Thorn as showing substantial resilience. He suggested this price zone is especially important as it comes amid concerns over the broader impact of artificial intelligence on the market.
Mini dictionary: 50-week moving average: This is a common technical analysis indicator that calculates the average closing price of an asset over the prior 50 weeks, smoothing out short-term volatility to reveal longer-term trends.
Market sentiment and positioning
Thorn described current market positioning as “light,” indicating that significant participation from retail and institutional investors remains limited. He observed that, despite Bitcoin prices approaching record highs, the broader market has not yet seen a widespread influx of speculators.
He also pointed to 13F filings, which track investment activity by major US money managers, to note that while some hedge funds have reduced exposure, sovereign wealth funds and large asset managers are entering the space. Thorn interpreted this as a sign of maturing market participation rather than frenzied speculation of prior cycles.
| Investor Group | Recent Activity |
|---|---|
| Hedge Funds | Reducing exposure |
| Sovereign Wealth Funds | Increasing participation |
| Wealth Managers | Increasing participation |
Macro themes and Bitcoin narrative
Thorn discussed several larger market themes influencing Bitcoin, such as tokenization trends, the narrative pendulum, and continued interest in the “basis trade” strategy. He touched on the connection between artificial intelligence development and inflationary pressures, suggesting the AI sector’s rapid expansion could become a “debasement machine” by increasing monetary supply and decreasing purchasing power.
Another focus was on fiscal risks in the US, including climbing national debt and the idea of “fiscal dominance.” Thorn positioned Bitcoin as a strong digital alternative to gold, potentially benefiting from these macroeconomic factors.
Finally, he warned that the rise of AI-driven cyberattacks could make security measures like hardware wallets and multisig setups increasingly important for digital asset holders.
