The world of cryptocurrency eagerly awaits the planned Bitcoin (BTC) fourth block reward halving amidst the current market downturn around April 19 or 20. A prominent figure in crypto trading and analysis, Rekt Capital, recently shared his views on Bitcoin’s notable pullbacks since the bear market of November 2022. Let’s now examine these retractions and their impact on investors.
Bitcoin Analysis
Since hitting a low in November 2022, Bitcoin has faced several significant pullbacks. In February 2023, regulatory actions targeting crypto exchanges like Paxos and Kraken in the US led to a 23% drop within 21 days. However, a rising trend in Asian markets, particularly Hong Kong, facilitated a recovery from the decline. Following this, a 21% drop over 63 days occurred in April/May 2023, influenced by a large sell order on Binance and high inflation figures in the United Kingdom, leading to significant liquidations in Bitcoin futures.
The summer of 2023 saw another prolonged pullback of 63 days, resulting in a 22% drop, attributed to various factors including geopolitical tensions impacting market sentiment and concerns over the US potentially selling BTC seized in the Silk Road operation. Additionally, in January 2023, a 21% drop occurred amid cautious sentiment influenced by US inflation and Federal Reserve (Fed) policy expectations, along with investors taking profits amidst a significant rise.
In March 2023, a shorter but notable pullback occurred over seven days, characterized by an 18% drop attributed to a hawkish Fed and the collapse of Silvergate Bank. The ongoing retracement, lasting about eight days, has seen approximately a 16% drop, marking the sixth major pullback since the 2022 bear market low. This drop, while longer, is relatively shallower and is linked to the liquidation of leveraged positions in the crypto market, as well as tax season and increasing geopolitical risks amidst market weakness.
The Decline May Deepen
Fundamental observations indicate that most pullbacks are around 20%, highlighting a recurring trend in Bitcoin’s price movements, while varying durations showcase the volatile nature of the crypto market. Rekt Capital warns that the price falling below the $60,000 support could deepen the ongoing retracement, potentially revisiting or surpassing levels seen in March 2023.
As of this writing, Bitcoin has dropped 2.98% in the last 24 hours, pricing just above the $60,000 threshold. The largest cryptocurrency is currently trading at $61,623.
