Bitcoin moved higher on Tuesday after Donald Trump said planned strikes on Iran would be paused for five days, lifting BTC by about 3% and pushing it back above $70,000. Even with that rebound, the asset remains roughly 45% below its reported all-time high of $126,000.
The bounce was sharp. The warning from market analysts has not gone away. Chart analyst Ali Martinez said Bitcoin could still fall toward $40,000 by October 2026.
Four-year cycle points to a late discount phase
According to a chart shared by Martinez, Bitcoin has continued to track a repeating four-year cycle that he says has appeared since 2011. In that framework, each major bull run starts only after price enters a final discount phase, then forms a base before the next leg higher begins.
His chart places the current market close to that stage. Martinez highlighted a potential buy zone between $41,500 and $45,000, an area that previously acted as a base ahead of larger rallies. If that fractal continues to hold, Bitcoin may first decline into the $40,000 region before establishing a bottom.
He also pointed to a possible entry window between October 6 and October 16, 2026. In earlier cycles, similar timing marked the end of consolidation and the start of a fresh four-year advance.
Small-ticket Bitcoin activity weakens
A separate warning comes from retail participation. Crypto analyst Crypto Tice said Bitcoin transactions below $10,000 are falling sharply, a sign that smaller investors are stepping back from the market.
The report says the 30-day demand trend for retail participants has turned negative. That does not describe price alone; it points to changing market participation. When smaller transactions fade, retail engagement usually weakens as well. In past Bitcoin cycles, retail traders often exited during late-stage corrections, while trading volume shrank before a base formed.
Broader rallies have often followed only after retail demand returned. For now, the setup remains mixed: geopolitical relief has helped Bitcoin recover in the short term, while activity from smaller investors still looks soft. In the view presented in the report, that combination has often appeared during accumulation phases, though the path could still include a move toward the $40,000 area if the historical pattern repeats.