Bitcoin’s price has experienced a decline of approximately 21% from its record high. However, based on historical patterns, there is a possibility that Bitcoin could further drop to the $50,000 mark in the near future.
According to data from CoinMarketCap, Bitcoin’s price fell by over 12% on the weekly chart and currently stands at $57,780 as of 1:10 p.m. UTC. This represents a 21.6% decrease from its all-time high of $73,750, which was achieved on March 14.
Renowned Bitcoin analyst Rekt Capital states that the ongoing correction is the most significant retrace of this particular cycle. In a post on May 1, Rekt Capital noted that the pullback has lasted for 48 days, surpassing the longest retrace of 63 days in this cycle.
Similar corrections have been observed during previous Bitcoin bull runs. In the 2018 rally, Bitcoin experienced five corrections exceeding 30%, along with an additional 29% correction, as detailed by pseudonymous Bitcoin trader Sister Laura in an April 30 post.
Bitcoin recently lost a crucial support level at $59,000, which also served as the short-term holder realized price (STH-RP). This refers to the average inflow price of spot Bitcoin exchange-traded funds (ETFs). The failure to maintain this support level could potentially lead to a revisit of the $50,000 mark, according to Bitfinex’s head of derivatives, Jag Kooner.
If Bitcoin’s price falls below $60,000, it is estimated that over $750 million worth of cumulative leveraged long positions would be liquidated across all exchanges, as reported by Coinglass.
The decline below the $60,000 mark occurred shortly after the introduction of the first spot Bitcoin ETFs in Hong Kong. Despite accumulating $12.4 million in daily trading volume on its debut, the Hong Kong ETFs generated lower-than-expected trading volumes due to challenging macroeconomic conditions, according to James Wo, the founder and CEO of DFG.
It is important to note that this article does not provide investment advice or recommendations. Every investment and trading decision involves risks, and readers are advised to conduct their own research before making any decisions.