Bitcoin has dropped nearly 9% since hitting $ 12,485,but could see more losses according to analysts.
Bitcoin’s drop to lows of $ 11,000 is that a tip of the many pullbacks that the market should expect as the top cryptocurrency matches towards a new all-time high.
That is the advice and opinion of Josh Rager, the co-founder of Blockrots.com and crypto analyst.
Revisiting a tweet he shared in 2019, the analyst pointed to the current decline as just a pullback and that reaching a new all time high will be sandwiched with several of these.
According to him, “30% to 40% pullbacks” will not be surprising as the latest bullish cycle looks to take BTC/USD to a new all-time high above the $ 20,000 reached in December 2017.
Bitcoin pullback normal market behavior
As seen over the past 48 hours and going back to last week, Bitcoin has retreated from new 2020 highs above $ 12,480 to touch lows of $ 11,079. The action in the past week appears to confirm a minor pullback for BTC/USD.
As of writing, Bitcoin is about -9.0% since the spike to the YTD highs and could even see further declines given bears are intent on halting recent momentum.
Josh Rager believes this is perfectly normal and that traders should be ready for many harsher pullbacks.
“I hope you’re not worried about this pullback by [BTC]. You can expect several more 30% to 40% pullbacks on the way up to new highs for Bitcoin. This is just the reality of the market, “he tweeted.
Bitcoin’s current bull cycle
Per research and analytics firm CoinMetrics, the crypto market is in the middle of a bullish cycle that could last over a year from now.
An analysis of Bitcoin’s earlier bull cycles shows that this could be its fourth major installment in history.
A look at the cycle of tops and bottoms over the past decade shows that the last bullish cycle started in 2015 and lasted till the crypto bear market of 2018. A dip to lows of $ 3,000 began the latest cycle in December 2018 and has yet to hit a new top more than 600 days later.
The March 2020 market crash following the spread of Coronavirus took BTC/USD to lows of $ 3,800. However, prices have since surged to hit a new high to suggest a repeat of the last cycle could be massive for Bitcoin.
“Financial history has shown us that the formation of asset bubbles appear to be linked to deeply rooted aspects of human behavior,” the research states.
According to the report, the last cycle lasted more than 1000 days. As such, if the current trend maintains, Bitcoin could hit a new all-time high somewhere in the next one to one-and-half years.