Bitcoin continues to face significant losses, leading to discussions regarding its future growth prospects. The current drawdown has drawn attention from analysts who evaluate it in light of historical data.
Current Bitcoin Decline
Bitcoin has plunged 26.62% from its record high of $109,500, which could become the deepest drawdown of the current bull market cycle, according to CryptoQuant's head of research, Julio Moreno.
Comparison with Previous Cycles
In the past, Bitcoin has experienced significant drawdowns, such as 83% in 2018 and 73% in 2022. The current decline, while substantial, remains less severe compared to previous bear markets. Analysts from ecoinometrics noted, "historically, when the NASDAQ 100 falls below its long-term year-on-year average return, Bitcoin tends to grow more slowly," indicating challenges in predicting a quick recovery.
Potential Support Levels
On the weekly chart, Bitcoin tested the 50-weekly exponential moving average. A close below this level may signal the beginning of a bear market. Anonymous crypto trader Rekt Capital indicated that, "historical daily RSI trends suggest anything from current prices to ~$70,000 is likely to be the bottom of this correction."
The decline of Bitcoin amid the overall state of the crypto market raises concerns among analysts. It remains unclear whether current support levels will hold the price and trigger a recovery.
