Bitcoin’s remarkable bull market remains firmly in place, even as investor anxiety mounts over the current pullback, which analysts believe could merely be a temporary “shakeout” before the next upward surge.
Currently, Bitcoin’s (BTC) price has dropped 22% from its peak of over $109,000 achieved on January 20, coinciding with the inauguration of former US President Donald Trump, as reported by market data.
Although investor sentiment has plunged into the “Extreme Fear” zone on several occasions, historical chart patterns indicate that this may just be a price shakeout—a rapid decline triggered by many investors exiting their positions, typically followed by a swift recovery.
“Multiple critical technical indicators have turned bearish, raising concerns that the bull market may be coming to an early end,” analysts at one major platform observed.
“However, Bitcoin’s four-year cycle continues to play a pivotal role in shaping price trends historically,” they elaborated, adding, “Corrections during bull markets are normal, and historical patterns suggest this could be a shakeout rather than the onset of a prolonged downturn.”
Additionally, the introduction of US spot Bitcoin exchange-traded funds (ETFs), which briefly exceeded $125 billion in total assets, along with increasing institutional investments, suggests that traditional cycles may no longer apply, according to the same analysts.
In a positive turn for market sentiment, Bitcoin managed to close above $84,000 on March 15, marking its first daily close above this threshold in over a week since March 8.
However, given Bitcoin’s correlation with conventional financial markets, analysts note that BTC may only find a bottom in tandem with the stock markets, especially the S&P 500. They commented, “While $72,000–$73,000 remains a critical support zone, the overall market environment, particularly global treasury yields and stock trends, will play a significant role in determining Bitcoin’s forthcoming major moves.”
“Trade wars have already factored into the pricing to some extent, but ongoing economic pressures could impact sentiment,” the analysts concluded.
Despite concerns regarding the sustainability of Bitcoin’s bull market, the four-year cycle and the upcoming Bitcoin halving remain essential factors in the cryptocurrency’s price trajectory, according to an analyst from a digital asset investment platform.
“The compound annual growth rate (CAGR) for Bitcoin over four years has fallen to an unprecedented low of 8%, raising doubts about the validity of its traditional four-year cycle,” the analyst stated, further noting, “While robust institutional interest over the past year has provided a significant boost to Bitcoin, its halving events are still anticipated to have a long-term impact.”
The upcoming 2024 Bitcoin halving will decrease the network’s block reward to 3.125 BTC per block. Thus far, Bitcoin’s price has increased by over 31% since the last halving, which took place on April 20, 2024, marking it as a potentially “most bullish” scenario, in part due to growing institutional enthusiasm for the leading cryptocurrency.