Bitcoin is most likely doing what it always does during bull markets, and that's pullback by roughly 30%
I've seen some questions out there where people are starting to say that $58k number might have been the bull market top...
Nothing like some good ol fashioned fear uncertainty and doubt (FUD), am I right?
While I don't have a crystal ball, I can't tell the future, and simply make just about all my predictions/thoughts based on past patterns, the odds of that being the bull market top are extremely low.
Yesterday I postulated whether the current drop would be a quick pullback and then a resumption of the uptrend or it would be something a little longer and deeper, down in the 30% range.
I think at this point, with bitcoin already testing $45k (22% drop from $58k) it's looking like it will indeed be one of those 30% corrections.
As we've seen time and time again, 30% corrections are nothing out of the ordinary during bull markets.
We saw 6 of them during the 2016-2017 bull market:
So far, during this bull market, we have seen 2 roughly 30% corrections, with this looking very much like it will end up being the 3rd such correction so far.
Interestingly enough that puts us very much on pace with the chart I posted above with the 3rd 30% correction happening around March ish...
What should we expect if this is indeed another 30% correction?
I keep posting that chart above in a lot of my recent posts because it's such a gold mine of information for those participating in the bitcoin and crypto markets.
While history doesn't repeat exactly, it sure rhymes an awful lot in the bitcoin/crypto markets.
- 6 corrections of roughly 30%
- 100% gains from the lows of each correction
- 153% average gain from the low of each correction
- 3.3 weeks from peak to trough (on average) during the correction
There is a whole host of data to be gleaned from the above chart, but the above is just some of it.
As it relates to the current bull market cycle we are already seeing this info play out yet again, and some new data is emerging as well, such as this:
Keep in mind that the creator of this chart doesn't understand how to calculate percentages as the previous correction was roughly 31%, but irregardless we can see that both rallies lasted for roughly 28 days.
Whether that pattern continues or not, I have no idea as the prior rally phases weren't identical in length back in 2017, though most were similar in length.
Applying the above data to the current correction and it looks like we could expect to see bitcoin drop to around $40k or so before turning back up.
It may take several weeks to put in the low.
Then from those lows it is very likely to rally north of 100%, which would be north of $80k+ before the next 30% correction.
Hopefully this helps give some insight into what is likely going on right now.
Stay informed my friends.