A popular crypto analyst is looking at historical data to determine whether Bitcoin (BTC) has actually reached its bottom or not after enduring an extended downtrend.
In a new strategy session, Nicholas Merten cautions his 516,000 YouTube subscribers against feeling too exuberant about Bitcoin rallying off its weekly lows after BTC briefly dipped under $18,000 on Saturday.
I don’t want people to get too caught up in the excitement. While I do feel we could see another day or so of gains, maybe even coming back up to this range here [around $22,300], I want to emphasize the difference between where we are now, this 75% correction, and what an 80% correction might look like.
One of the biggest difficulties that some people have is understanding how percentage declines can get exponentially worse, even though you’re only moving down technically in the sense of percentage terms by a couple of single-digit points.
If we go from 75% to the typical 80% correction, what would that look like? It wouldn’t just be a couple hundred dollars or a thousand dollars down i no, we would be going from a $17,500 Bitcoin price all the way down towards around $13,700. Testing towards that $14,000 range that we saw the price top out at, or at least set an interim top, during the bull market back in June of 2019.
The strategist goes on to say that while he isn’t certain Bitcoin will actually drop a full 80% from its November 2021 all-time high above $69,000, broader macroeconomic volatility might force the king crypto lower despite historical trends and fundamental strength.
“While I would usually expect that corrections grow weaker over time, and they have historically grown weaker, it’s probably going to be that we get the typical 80% correction considering the macro environment we’re in right now.
That’s an important thing to keep open to here, to not absolutely go all-in in this case.
At time of writing, Bitcoin is up over 4% over the last 24 hours, trading for $20,811.
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