Sold in May and went away? Bitcoin risks another 10% drop as month turns red

Bitcoin (BTC) whitethorn beryllium flashing a “sell successful May and spell away” warning, with the terms down astir 10% aft rejecting absorption adjacent $83,000 and present connected way for a antagonistic monthly close.

BTC/USD regular terms chart. Source: TradingView

Key takeaways:

• BTC's mean returns a period aft a reddish May are -10%
• Patient Bitcoin holders inactive generated affirmative returns implicit the longer term.

Bitcoin's reddish May typically leads to anemic summertime returns

"Sell successful May and spell away" is simply a fashionable Wall Street saying based connected the thought that stocks thin to execute amended during the colder months than during the summertime stretch.

For instance, the US benchmark index, S&P 500, averaged -0.24% 1 period and -2.25% 3 months aft reddish Mays since 1990, earlier recovering to +1.22% aft six months and +7.44% aft 12 months.

Bitcoin’s ain May past shows a akin short-term warning. BTC posted losses successful May successful 2013, 2015, 2018, 2021, 2022, and 2023. Its mean returns 1 period aboriginal were -10.1%.

Bitcoin monthly returns. Source: CoinGlass

The three-month mean instrumentality was besides antagonistic astatine astir -3.3%. Therefore, BTC typically does not spell done a important betterment successful the summertime aft dropping successful May. That supports the thought that a reddish May tin enactment arsenic a short-term capitulation signal.

But, similar US stocks, the longer-term representation is little bearish.

Six months aft a antagonistic May, BTC’s mean instrumentality jumps to astir +139%, mostly due to the fact that of 2013’s monolithic late-year rally. Excluding that outlier, the six-month mean falls sharply to astir +12.9%.

Based connected Bitcoin’s existent terms adjacent $75,850, its humanities post-red-May averages connote a possible driblet toward $68,200 by June and $73,350 by August.

The six-month mean points to astir $181,300 by November, though that fig is heavy distorted by 2013. Excluding that outlier, the six-month people falls to a much realistic $85,600.

Based connected these humanities signals alone, semipermanent Bitcoin investors person small crushed to "sell successful May and spell away."

The information points much to short-term weakness than a lasting breakdown successful BTC’s broader upside trend.

Bear-market reddish Mays were much unsafe for Bitcoin

If Bitcoin closes the period beneath $76,000, the reddish May candle volition beryllium wrong a bear-market structure.

In 2018 and 2022, May losses did not people a speedy bottom. Both years were already showing carnivore rhythm signals, with BTC trading beneath large enactment and forming little highs and little lows.

After those reddish May closes, Bitcoin fell an mean 26% 1 period later, 21.6% 3 months later, and astir 46% six months later.

BTC/USD monthly chart. Source: TradingView

In mean oregon inter-cycle years, a antagonistic May has usually pointed to short-term weakness, not a afloat inclination breakdown. But successful carnivore markets, the aforesaid awesome has historically preceded deeper capitulation.

Related: Analyst says Bitcoin’s $60K bottommost signals weaken bear-market forecast

So far, 2026 is not a afloat confirmed Bitcoin bear-market year.

In anterior carnivore markets, BTC archetypal broke beneath large rhythm support, astir $6,000 successful 2018 and $30,000–$32,000 successful 2022, earlier capitulation deepened.

BTC/USD monthly chart. Source: TradingView

BTC inactive trades adjacent $75,000, supra its existent rhythm enactment adjacent $60,000. A adjacent beneath that portion would fortify the bear-market case.

A monthly adjacent beneath $70,000–$72,000 would besides embolden the bears, portion a deeper interruption beneath $60,000–$65,000 would marque it harder to disregard the existent slump arsenic a specified correction.