Could a 30% collapse be in the cards?

Today, Bitcoin fell from $102,748 to $92,175, which represents a 10.3% decline over the past 24 hours.

This development has sparked discussions in the community, with analysts comparing previous market cycles. Historical trends indicate this Bitcoin It often undergoes significant pullbacks a few weeks after the price discovery phase. This has raised concerns that the current downturn may be just the beginning.

Historical Insights into Bitcoin Corrections

Cryptocurrency analyst Rekt Capital He pointed out Bitcoin’s steady corrections pattern after rising to price discovery phases. He noted that in 2013, Bitcoin experienced six weeks of upward momentum before experiencing its first major correction in the seventh week.

Likewise, during the 2017 bull cycle, a 34% retracement occurred in week eight after seven weeks of continuous gains. Likewise, in the 2020/2021 cycle, Bitcoin rose for six weeks after price discovery before a significant 16% pullback.

Highlighting these patterns, Rekt Capital noted, “It’s week seven now.” This means that the ongoing correction is consistent with historical trends and that a major pullback may be underway.

Is there a 20-30% correction on the horizon for BTC?

Adding to the discussion is famous cryptocurrency futures trader Satoshi Flipper Confirm The importance of studying historical patterns. He warned that a strong correction during Bitcoin’s price discovery phase is realistic.

It is worth noting that Bitcoin entered the price discovery phase in the second week of November after that Donald Trump He won the presidential election. Since then, the asset has seen consecutive days and weeks of new price highs, with only a few instances of 3% corrections.

Meanwhile, Satoshi Flipper reminded market participants that a 20% to 30% Bitcoin collapse is realistically on the cards. Specifically, he highlighted that a 20% decline from Bitcoin’s recent high of $108,000 would result in a bottom at $87,000. Meanwhile, a 30% bounce could send Bitcoin price down to the $76,000 level.

Indeed, Bitcoin has collapsed nearly 15% from its all-time high to $92,000, and has since rebounded to $95,000 at press time, though the risk remains.

Can Bitcoin defy historical trends?

A Final analysis Glassnode shows that Bitcoin is now seeing lower average returns and lower volatility in the current cycle compared to previous cycles.

For example, while Bitcoin saw 10.47X growth in the 2018-2022 cycle, the current season has only seen 598% growth. Likewise, this session was the least volatile, with drawdowns averaging -7.68% and maximum -26.25%. Previous sessions had minimum drawdowns of 26% and maximum crashes of 72%.

According to the report, this stability indicates Bitcoin’s transition to a more mature institutional asset, making a collapse similar to the last cycle less likely.