Bitcoin Pulls Back, But Raoul Pal Says We're Entering 'Phase 2 Of The Banana Zone'

Bitcoin (CRYPTO: BTC) has the last leg of its bull run still ahead, according to new analysis by macro investor Raoul Pal.

What Happened: In a May 18 podcast, Pal said crypto is now entering "Phase 2 of the Banana Zone," the part of the cycle where liquidity rises and prices accelerate after early-stage consolidation.

With inflation cooling and global liquidity improving, Pal sees conditions aligning for a major bull run through 2025.

He likens the current volatility to Bitcoin's 2017 cycle, which saw multiple sharp corrections of 27% to 39%, yet ultimately delivered historic gains.

Pal criticized the panic around routine pullbacks, saying investors often swing too quickly from extreme optimism to catastrophic pessimism.

Looking ahead, Pal envisions crypto's total market cap soaring from $3 trillion to $100 trillion within a decade.

Even cutting that in half would exceed the combined wealth creation of post-Soviet Russia, the rise of China, Silicon Valley, and the hedge fund boom.

This is just the start, he added and even a 50% miss means the biggest wealth creation event in history.

Also Read: Tom Lee Says ‘Bitcoin Is the Way’ After Strike CEO Predicts It’s About To ‘Go Nuclear’

What's Next: Market commentator TheScalpingPro noted Bitcoin just faced rejection at the range high for the third time, a critical resistance zone. He says while a first breakout attempt is rarely successful, the setup still looks bullish.

Two likely bullish outcomes:

• Scenario 1: BTC consolidates and then breaks out strongly.
• Scenario 2: BTC dips toward the mid-range (~$99,400), retests support and then climbs implying a healthier breakout setup.

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Image created using artificial intelligence with Midjourney.