PlanB, the pseudonymous analyst behind the stock-to-flow model, has shared insights into Bitcoin’s potential bear market paths. According to him, the ongoing drawdown could lead to four distinct scenarios for Bitcoin's price movement. These range from a classic 80% drop to the possibility that the lows are already behind us.

In a recent post on X, PlanB emphasized the importance of historical context when looking at Bitcoin’s bear market bottoms. He framed his analysis around long-term trend metrics while suggesting that the previous rally's lack of momentum could mean a shallower market reset this time around. Bitcoin closed January at approximately $78,000, which marks a significant 40% decline from its all-time high of $126,000.

PlanB's analysis included key price points such as the 200-week moving average closing at $58,000 and the realized price at $55,000. He noted that January's Relative Strength Index (RSI) ended at 49, a critical level that he interprets as indicative of a regime shift. In his view, an RSI below 50 signifies a downtrend, aligning with previous bear markets seen in 2014, 2018, and 2022.

From this analysis, PlanB outlined four bear market scenarios. The first scenario reflects the historical “worst case,” suggesting an 80% drop from the all-time high. This would put Bitcoin's price around $25,000, a level that, while theoretically possible, PlanB acknowledges would look “really odd.”

The second scenario is more in line with his backtests, estimating a bottom around the 200-week moving average and realized price, which he places in the $50,000 to $60,000 range. PlanB points to previous cycles where price has gravitated towards these long-term anchors, highlighting 2022 and 2015 as examples where the RSI trough coincided with those levels.

The third scenario suggests a shallower retrace, stopping just above the previous cycle’s all-time high of around $69,000 to $70,000. PlanB believes that the muted signals from the preceding bull run could compress the bear market's magnitude. He argues that since the previous bull market lacked the typical high RSI peaks, the subsequent bear might be less severe.

The fourth and final scenario is the one that traders are often eager to see: the idea that the market has already found its low. PlanB mentioned that the recent price of $72,900 could potentially be the bottom, but he also noted that Bitcoin had dropped to $70,140 shortly after, casting doubt on this optimistic outlook.

In addition to these scenarios, PlanB revisited his stock-to-flow model, which still predicts a Bitcoin value of $500,000 based on its scarcity. However, he cautions that this model does not provide insight into market tops or bottoms. Instead, it is designed to capture the four-year average and periodic phase transitions that typically occur every four to five years.

PlanB concludes that the cycle may, in fact, be evolving. Historically, Bitcoin peaks have tended to occur within the first or second year after a halving event. Yet, he notes that this pattern did not hold after the 2024 halving, leaving open the possibility for an upward phase later in the cycle. As Bitcoin navigates these potential scenarios, the focus remains on whether it will trend towards the realized price and 200-week average, hold above the previous all-time high, or validate a higher low in the low-$70,000s.