I Was Wrong About August. Here Is Why I Am More Bearish Now.

If I only published when I was right, you should stop reading me. So let us start with the scoreboard.

On 1 August I called for a typical bear market August, historically down 16% on the median. With a week left, August is up 26%, and Bitcoin touched $79,989 this morning. If the month closes anywhere near here it will be the first green August inside a bear market in Bitcoin's history. The four before it went -39%, -18%, -9% and -14%.

My monthly calls this year had gone seven for seven. Lower in January and February, the trap rally in March and April, lower in May and June, the July bounce that faded. August makes the record 7 for 8. Dunk away, it is earned.

Now here is the uncomfortable part. Working through why the call missed made me more bearish about the next couple of months, not less. Not as a reflex, but because of what this specific rally is made of. I will show every number.

What this rally is

The move was not a wave of people deciding Bitcoin is cheap. It was ignited by force. Over $4 billion of bets on lower prices were liquidated inside a week, roughly $3 billion of it in a single day, the largest short wipeout in at least five years. A liquidated short is an automatic market buy. It cannot pause, it cannot reconsider, and it stops existing the moment the shorts are cleared.

I covered the mechanics in detail in the Overbought Study last week, when the 4-hour RSI printed 94, a level seen only once before in 13 years. What matters today is what has happened since.

The rally is now the size where fake-outs peak

Since 2011 there have been 15 bear market rallies of 15% or more that later failed. Their median peak was +35% off the low, reached a median 26 days after it. This rally is at +38% off the July 1 low, 54 days in. Only 6 of the 15 ran further than we already have.

Size proves nothing on its own. Some fake-outs ran to +67%, +77%, +85%. But it says we are standing on the exact ground where most of them died, and that chasing here is buying the prices every previous leg down erased first.

Momentum is diverging

On 21 August, price hit $78,325 while the 4-hour RSI peaked at 94, the hottest reading since 2013. Three days later price pushed higher, to $79,090, and RSI could only manage 74.

A higher high in price with a 20-point lower high in momentum means the new high was built by fewer, weaker buyers than the last one. That is what it looks like when forced buying hands over to organic demand and the handover is not going well. Divergence is a warning rather than a timer, and it earns a place in the pile of evidence, not a verdict by itself.

September is next

The month that begins in a week is one of Bitcoin's three worst. Since 2011, September's median return is -2.9%, red in 9 of 15 years, ranked behind only August and December. In bear market years it went red 3 of 4, with 2014's -18.7% the worst of them.

Two honest admissions belong next to that. August has the worse seasonal record of the two, and August is precisely the month that just broke the seasonal case in record fashion. And a -2.9% median is a lean, not a law. The bet is on the record anyway. We expect September red, and if it closes green, the seasonal leg of this framework takes its second straight loss and gets weighted down accordingly.

Nothing underneath changed

Inflation is still running above target, with the July CPI at 3.4%. Another rate hike is still a live possibility priced by markets. The war in Iran is ongoing, and the Strait of Hormuz remains effectively shut. A shipping corridor between Iran and Oman is under negotiation, and Iran itself has said a deal would not by itself reopen the waterway. The macro conditions that started this bear have not resolved. The crowded shorts resolved.

The call, in both scenarios

The call is a pullback, and the point is that it does not depend on knowing whether the bottom is in.

If the bottom is not in, history says the window for the final low is still open. The last three bears set their final low 13.4, 12.0 and 12.4 months after their cycle tops. The October 2025 top was 10.6 months ago. The 15 failed rallies, after peaking, fell a median 67% to the bear's eventual bottom, with even the mildest losing 26% from its peak.

If the bottom is in, price still does not travel in one direction. After each of the last four genuine bottoms, the first big rally pulled back from its peak within 90 days: -41% in 2012, -27% in 2015, -6% in 2019, -18% in 2023. Median -22%. The scenarios disagree about the destination, not about the next stop.

Either way, chasing a vertical, liquidation-driven move at the median fake-out size has the worst record in the dataset. Patience got a better entry than momentum in both worlds.

The two lines that decide it

Everything above compresses into two prices, written down in advance so they cannot be argued with later.

$82,833, the May high. Every major high since the October top has been lower than the one before it, $126,272, then $97,939, then $82,833, then this week's $79,989. A daily close above the May high breaks that sequence for the first time in the entire bear. If it happens, the honest response is to re-evaluate and accept that the market is changing, not to argue with it. It sits about 5% above the current price, so this framework is at its most falsifiable exactly as I publish it.

$57,735, the July low. A close below it means the pullback was not a pullback, and the bear's final leg is running on schedule.

Between the lines, both scenarios stay alive and the base rates above are the best available guide.

The honest limits

Fifteen failed rallies and four real bottoms are small samples, and the medians hide wide tails, including a 2019 case where the post-bottom pullback was barely 6%. The seasonal argument just lost a month in record-breaking fashion, and it is included anyway because dropping a leg right after it loses is how frameworks quietly become unfalsifiable. And a 7-for-8 record does not transfer to the ninth call, which is why this one, like every one before it, ships with the exact level that proves it wrong.

August closes in a week. I will post the result, whichever way it lands.

Education, not financial advice.

Common questions

Was August 2026 really the first green bear-market August?

On the record so far, yes. The four Augusts that fell inside bear markets all closed red: 2011 about -39%, 2014 -18%, 2018 -9% and 2022 -14%. August 2026 is up roughly 26% with a week remaining, which would make it the first green August inside a Bitcoin bear market if it holds.

Is the Bitcoin bottom in after this rally?

It cannot be known yet, which is the point of the two-line framework. The rally is at +38% off the July low, past the +35% median peak of the 15 failed bear rallies since 2011, with bearish RSI divergence forming. But 6 of 15 fake-outs ran further, and the two famous bear exits also started as big rallies. A daily close above $82,833 would break the bear's sequence of lower highs; a close below $57,735 would confirm the final leg.

Why expect a pullback if the bottom might be in?

Because pullbacks followed every genuine bottom too. After the real lows of 2011, 2015, 2018 and 2022, the first big rally pulled back -41%, -27%, -6% and -18% from its peak within 90 days, a median of -22%. A vertical, liquidation-driven rally at the median fake-out size has historically offered better entries on the retrace in both scenarios.

How bad is September for Bitcoin historically?

Third worst month since 2011. September's median return is -2.9% and it has closed red in 9 of the last 15 years, behind only August (-8.4% median) and December (-3.2%). In bear-market years September closed red 3 times out of 4, the worst being -18.7% in 2014.

What price would prove the bear market is over?

A daily close above $82,833, the May 2026 high. Bitcoin's major highs since the October 2025 top have stepped down without exception: $126,272, $97,939, $82,833, and this week's $79,989. Breaking that sequence would end the downtrend structure, at which point the bearish framing should be re-evaluated rather than defended. The level sits about 5% above the current price.

Keep reading

• Bitcoin's 4-Hour RSI Just Hit 94.4. Here Is What Happened Every Other Time.
• Bitcoin Hit $69,749. Is the Bottom In?

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Education, not financial advice. Trading involves real risk.