Transcription
Hello followers of the four-year journey. This is Bob Lucas on December 22nd, 2025 with a pretty quick update here today, mostly because there's a change in the model portfolio allocation.
So the first change is 7 BTC from the model portfolio sold at 90,000 USD. Um and that is mostly because from all measures this four-year cycle is now confirming a 35month high in the four-year cycle and therefore now in the declining phase of this 4-year cycle. We've seen a complete loss and close well below the 10-month moving average. A nice trend line that I like to use for which direction the market is heading.
This month here, December, hasn't really done anything. And we've had obviously risk assets do really well. We've had the e equity markets at pushing all-time highs. We've had gold, AI stocks, tech stocks, and the lot all pushing all-time highs. Whereas Bitcoin in the most bullish year of the four-year cycle pretty much be flat for the entire year. there's just been very little interest in in crypto as a whole and Bitcoin more specifically at a time when the environment was very favorable for a significant move up in this four-year cycle to a high.
Uh we've obviously seen a lot of significant selling from the whales in this cycle. So it's been now sort of 12 15 year holders are dumping at significant significant rates. On the flip side of that, we have DATs, Michael Sailor, institutions buying a tremendous amount of Bitcoin that has really not resulted in an upside move. So that divergence from from an environment where the cycle should be pushing further highs and has not, where equity markets and risk markets in general have had a good year and Bitcoin has not. In my opinion, those are all telling. And now this loss of a 10-month moving average on month 36 is to me signaling that we're now in the declining phase.
Now I expected and still expect some type of counter trend rally to occur in a declining phase of a 4-year cycle. It's sentiment is pretty much as low as you can get and that is an environment where counter trend rally can take hold. But my other concern is that that counter trend move doesn't occur until after yet another significant downside leg in this decline before seeing a move up. And that's the reason for reducing the size a little bit more as opposed to just waiting for a push back above 100 105 110. that move again possibilities only um not predictions but possibility that we first may need to see continuation lower into February or March before any significant upside move a counter trend move and then the rollover into the final phase of the 4-year cycle decline.
I say that because on the weekly chart, we had what looks like a weekly cycle lower back here with this uh dump in November and we've spent the now this is the fifth week just trending sideways while at the same time the equity markets are pushing their own all-time highs. This divergence is not a good sign. There's a lot dependent on the equity markets going into this sort of whole day rally that still hasn't eventuated. But if the equity markets don't keep pushing through all-time highs and beyond, if they do manage to pull back and we go into a riskoff environment, then given the weakness that we've seen in Bitcoin, this does set up for the potential for this next weekly cycle or this next sort of 12 or 15 week period to be a continuation lower. And by that point, there would be no point in selling any more Bitcoin in this lower range if it was to get down there. just too far off the highs and we believe in Bitcoin's long-term vision too much to be reducing position size in this lower level down 40 45% or more from the highs at this level still down around 27% off the highs I think it's still a reasonably good level to be taking some profit in this market and then preparing for that possible move lower.
The other uh limit orders in there for selling at 100 105 110 still stand and that is to capture that if this if this can hold this level equity markets can continue doing uh all-time high push in February up into February then we can still see a counter trend move develop from here into around the February time frame back towards about the 110 level back into this sort of range be stalled there and then the fouryear cycle so it takes hold as we make that declining move lower.
Now, caution on the 4-year cycle moves that I'm making. I said this in the last video. You don't want to sell. You'd never want to be without Bitcoin. Um, I think everybody should have a long-term huddle bag that you're not trying to trade. Even on a long time frame like this, you don't want to be trading around that. You just want to hold and hold and you're looking at sort of a 10year horizon or something like that because nothing is foolproof. This cycle could dramatically be different and there are reasons why that could be the case as well. And you don't want to be caught underexposed or completely out of Bitcoin if the market does something totally different. and totally different meaning that this puts in a low right here and continues and and makes a high deep into 2026 and then we only see a sort of three or five month decline into a low there. There are other possibilities out there. I don't hold those to have a lot of weight in terms of probability because the cycle structure has been one that has been pretty clearly defined over the last 12 years or so and also of course how other asset classes behave in a cycle structure. uh to me to me I lean very heavily on the idea that we've peaked for this cycle and that the period between the high which was October and the period into the low which is due around October time frame is mostly a declining period.
Now that said it also does not have to be a traditional sort of 60 to 80 85% decline that we've seen in other cycles as well. There's evidence to suggest that maybe we're going to trend more sideways into this period with an ending kind of decline shakeout into a low and the and and the draw down from the highs may not be anywhere near as bad as what it's been in the prior cycles. Um, but so far this cycle has peaked exactly where the last two did in terms of time from the low. However, one thing that is different that this cycle experienced was a quickening, a rapid early accumulation in the cycle, possibly frontr running changes in uh government policy, regulation, and the ETF. More importantly, if you notice from the lows, we peaked, we made a new all-time high within 16 months from those lows before the hing period, which was uh different to prior cycles, whereas before that, it took 22 months to make an all-time high. and the cycle before that took 25 months. So, it's possible that we're sort of had this front running of this cycle uh made that sort of logical peak in December of 24 even though we made a higher high. Um, that here could have been the peak of the cycle more so and now this um distribution phase of the cycle could be well more advanced than it was in prior cycles. meaning that the eventual 4-year cycle decline may not be out in October around the 48-month mark. We could be looking at a cycle low that comes earlier, maybe even as early as the July or August time frame as well. That fits within the window of a cycle low. Typically, cycle lows can form 10 to 15% uh earlier or later than your typical length of the cycle. with the length of the cycle is 48 months. Seeing that low form 4 months earlier is not unusual in any cycle sort of strategy. Of course, this uh Bitcoin has been very consistent in sort of 47 48 months in duration from one low to the next. But there's nothing stopping this from bottoming out earlier. Especially if we look at this chart and we look at the highs, all-time highs being made sooner. It's possible that this cycle is a little more accelerated and a low could come sooner.
So by reducing some positions, I want to do that at a place where it makes a little more sense knowing that if we can't uh reduce all the portfolio into the cycle low, that's okay. It's a long time frame strategy and um we'll be happy like we have been in prior cycles to ride a good portion of that down to the next low because we're not in a rush when it comes to this. The the idea is to be selling as much or as much as possible near the highs and to be buying back as as whatever is available in terms of a cash position towards the cycle lows. um not afraid of this being a complete surprise.
I know there's a lot of discussion out there that the four-year cycles are dead and that there's a this is a business cycle. We're waiting for liquidity. This is a fiveyear cycle. I've heard quite a few different variations and I'm not going to outright just be here today to say that they're wrong because that's not a position I like to take. I'm open to any sort of path that a market can take, but I want to follow what I think is going to be the more likely one, the one that resembles its its prior behavior and character. And this is what it's showing me right now. At the moment, uh the arguments for this, the four-year cycle is dead. kind of strange to me because right now looking at this having peaked on month 35 and now clearly lost that 10-month moving average at least for now it's behaving exactly like other cycles have have in the past so I'm a little confused by that and then I hear talk about liquidity waiting for the business liquidity cycle that doesn't really explain why other asset classes uh are doing so well there's clearly a divergence here in interest and attention in Bitcoin, especially when you look at the rest of the space, crypto space as a whole, the altcoin space and so on, pretty much most of those peaked last December have not managed to make a higher high. So, the whole space is in a more of a depressed state. And the contrarian will say, well, that's perfect. That's where we want to be. Um, a flat year in the third year of a 4-year cycle means that this fouryear cycle is broken. Okay, maybe there's some merit to that. Again, I don't want to say that that's not the case, but typically I want to stick with the primary view, the primary structure that it's displayed in the past and being in the position where I think we're now in the declining phase of this cycle.
So, here's the look at the the four-year cycle portfolio. The second sale of this cycle here at the 90,000 level, increasing the cash cash position to around about 52% of the the portfolio still holding 20 BTC with targets at 100, 105, and 110 which remain in place. Um, keep a note on this. I'm going to be adding another target for a stop-loss order as well because there's a level where below 80,000 uh is triggering a further decline. So, I'll be adding to that. You want to be taking a look at this. There's a link to the portfolio in uh on on the post here in the comments section of the uh of the video.
Don't forget, of course, um that you want to be huddling. you want to, you know, if you're following something like this, of course, it's at your own discretion. Um, and you want to be holding at least an equivalent amount uh in a portfolio in just long-term huddle that is not uh subject to to to the volatility of Bitcoin. And you want to be you want to be in a position in five or 10 years time to still be holding that position in the event Bitcoin like I said does some type of uh goes into some type of environment that is just different to what we've seen in the past and you don't want to be locked out uh without any allocation. So that's very important something to consider.
So in summary I do think we're going to see a big counter trend move at some point. I do believe the four-year cycle has peaked. I can see a move up to about 110, even 113 that occur. My concern though is that that counter trend move is not going to come until a further move down uh in this four-year cycle confirming to everybody at that point that it's peaked before that countren comes in. So, I feel that this level is advantageous for reducing position size. have another video out in the new year, probably late January. Want to wish you all a great holiday period, a great merry Christmas, and a very happy new year to all. Take care.