Bitcoin is moving closer to its final bottoming zone, but the confirmation signals are not fully aligned yet, which makes patience, discipline, and preparation more important than excitement.

Bitcoin Analysis

Starting with Bitcoin, our framework remains unchanged. We are still in Stage 5, the true capitulation phase. This is the final and most emotionally difficult part of the cycle. It is the phase where panic peaks, weak hands get flushed out, leverage is removed, and the market moves into its final bottoming zone.

My base case remains that the final bottoming area is likely somewhere between roughly $37,000 and $45,000.

The important point is simple: we are getting closer, but we are not there yet. Several bottoming indicators are improving (of which I will show you one below), but they have not fully confirmed a final macro bottom. This is why patience remains critical. The goal is not to guess the exact low. The goal is to wait until the risk-reward becomes clearly asymmetric.

Weekly RSI and Divergence Structure

One of the most important signals remains the weekly RSI. This is not a new indicator for us. We have used RSI divergences for years to identify major cycle tops and bottoms, long before this signal became widely discussed again in recent days.

Right now, Bitcoin is starting to show the kind of structure that often appears before a major bottom. Price continues to make weaker lows, while RSI begins to make higher lows. That creates a bullish divergence.

This does not guarantee an immediate bottom, and it does not mean we should blindly buy. However, historically, weekly RSI divergences have often appeared near important cycle lows. It is one of the early signals that downside momentum is weakening, even while price still looks weak on the surface.

In my view, there is still room for Bitcoin to make a lower low over the next few months while still creating a clean bullish divergence on the weekly RSI. That would actually fit the structure we are watching closely: price makes one final weaker low, sentiment deteriorates further, but momentum does not confirm the move lower. That is often where the real opportunity begins to form.

That is why this signal matters. It tells us that the market is moving closer to a potential accumulation zone, but it still needs confirmation from price action, sentiment, liquidity, and broader risk conditions.

Crypto Outlook

The conclusion for crypto remains simple.

We do not chase. We do not force trades. We do not buy just because the market is getting closer to our target area. We wait for the final setup, we wait for confirmation, and then we execute aggressively when the risk-reward is strong.

Until then, discipline matters more than excitement.

This is exactly the type of environment where retail gets impatient, starts forcing entries, and then gets shaken out before the real opportunity arrives. Our job is to do the opposite. We remain patient, prepared, and ready to act when the data confirms the bottoming structure.

U.S. Macro Data

On the macro side, the U.S. GDP rebound was confirmed. Q1 GDP came in at an annualized growth rate of 2.1%, a meaningful acceleration from the weak 0.5% growth seen in Q4.

Consumer data also remained resilient, with personal income and PCE both rising 0.7%. This shows that the U.S. economy is still holding up better than many expected.

For markets, this is important because resilient growth reduces the immediate risk of a deep recession. It also gives the Federal Reserve less urgency to pivot aggressively toward rate cuts. In other words, the economy is not weak enough yet to force a major policy shift.

However, there is still a clear weakness beneath the surface.

The personal saving rate remains low, around 3%. That means the consumer is still spending, but not from a position of strong financial comfort. Consumption is holding up, but the cushion behind that consumption is thin.

This matters because resilient spending can support growth in the short term, but low savings make the economy more vulnerable if labor markets weaken, inflation remains sticky, or rates stay higher for longer.

Equity Market Rotation

Inside equities, we are also seeing an important rotation. The AI trade is no longer being rewarded as blindly as before. Even with strong earnings from companies like Micron, mega-cap technology stocks remain under pressure because investors are becoming more focused on the enormous cost of building and maintaining AI infrastructure.

The AI cost crunch is becoming more visible. Investors are no longer only asking, “Who benefits from AI?” They are now asking, “Who pays for it, how large are the capital expenditures, and when does the return on investment actually show up?”

That is a major shift. For the last several years, AI optimism allowed many companies to trade at extreme valuations. But as the cycle matures, the market becomes more selective. Strong revenue growth is no longer enough. Investors want profitability, efficiency, cash flow, and a clear path toward monetization.

This does not mean the AI theme is dead. It means the market is becoming more disciplined. The easy phase of the AI trade is likely behind us, and selectivity matters much more from here.

Overall, the market is moving closer to a major opportunity, especially in Bitcoin and crypto. However, we are not yet at full confirmation.

Bitcoin is showing improving bottoming signals, but the final capitulation structure is not complete. On-chain data is becoming more attractive, sentiment is already weak, and weekly RSI divergence is developing. But broader volatility is still too low, and we have not yet seen the type of full risk-off panic that usually marks the final phase of a major bottom.

On the macro side, the economy remains resilient, but the consumer is becoming more fragile beneath the surface with inflation rising. In equities, the AI trade is becoming more selective as investors focus more on costs, margins, and real returns.

This week: June Labor Data: Market Volatility and the Fed’s Policy Dilemma

For the upcoming June labor-market data, consensus expectations are centered around ADP Employment Change of roughly 118,000, Nonfarm Payrolls cooling to approximately 115,000, and the Unemployment Rate holding steady at 4.3%.

Markets should be prepared for elevated volatility heading into the holiday weekend. A stronger-than-expected labor print would likely be interpreted negatively by equities, as continued labor-market resilience would give the Federal Reserve more justification to maintain a hawkish stance and potentially proceed with additional rate hikes. On the other hand, a weaker-than-expected report, especially one showing a meaningful rise in unemployment, could quickly trigger recession concerns and broader risk-off behavior. An in-line print would likely be the most market-friendly outcome in the short term, as it would remove some immediate tail-risk uncertainty and could support a brief relief rally.

The broader issue remains the Fed’s difficult monetary-policy dilemma. Inflation is still proving sticky, but further rate hikes would continue to raise corporate borrowing costs, restrict credit conditions, and pressure business expansion. In that environment, a sudden deterioration in the labor market would be especially damaging, as it would weaken the consumer base and increase the risk of a central-bank-induced hard landing.

The read above is the kind of analysis I run 1:1. On a private Strategy Call we'll map where you are in this cycle, the key signals that identify major tops and bottoms before retail reacts, and where your portfolio is exposed. For investors managing $100K+ who want a clear, unemotional plan. Apply here: https://sonderbergresearch.com/

Kind regards,
Diego Sonderberg

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