As Bitcoin ($BTC) is hovering near its lowest since late 2024, but market observers have suggested that the leading cryptocurrency may not have bottomed yet and could fall further.
$BTChistorical data indicate a longer correction
On Wednesday, analyst Recto Capital compared Bitcoin’s current price movement to past cycle performance to determine how close the market bottom is for the major cryptocurrencies.
In a video analysis on X, a market watcher explained: $BTCDeviation from its all-time high (ATH) can serve as an important reference point for this evaluation. Notably, Bitcoin bottomed out 22% from its 2017 peak during the last correction cycle. It’s currently trading about 14% below its 2021 peak of $69,000, which could signal that the bottom may be near.
However, the analyst asserted that this metric alone “does not represent the mosaic of data that we need to pay attention to.” He said the length of previous bear markets is an important indicator to consider, noting that historically Bitcoin bear markets tend to last at least a year, and sometimes longer.
For example, during the 2021-2022 bear market, the leading cryptocurrency took approximately 365 days to complete a full correction phase. The current pullback has lasted about 240 days so far, and if it has already reached or is close to a bottom, it could deviate from past movements and be significantly shorter than previous cycles.
If the current cycle follows a similar timeline to previous cycles, $BTC The correction phase could remain for at least 120 days, with a bottom likely occurring around October and potentially extending further if the cycle mirrors longer historical patterns.
Will Bitcoin bottom another 20%?
The analyst emphasized that while the duration of a bear market is important, the depth of its retracement is another important factor. Bitcoin fell 77% in the last cycle, but fell 84% during the 2018 bear market.
Despite this, the stock has only fallen 53% so far this cycle, suggesting there may still be room for further declines. Based on this, he highlighted the trend of a shallower bear market, where the depth of the correction gradually decreases by about 7% to 10% per cycle.
If this pattern repeats, Bitcoin could see a near 70% retracement this cycle. $BTCThe bottom price is in the low $30,000s. On the other hand, if the shallowing trend accelerates toward a 10% reduction, a bottom could form around the low $40,000 range.
These factors point to a critical period over the next four to five months, with the possibility of a further decline of up to 20% remaining, the analyst asserted. He noted that historically similar phases have included periods of decline followed by additional declines before a final bottom is formed.
Ultimately, Recto Capital argued that this period is a critical time to lay the foundations for the next bullish cycle. “The bear market here (…) precedes a whole multi-year rally. And that’s why, as a result, I think it’s important to focus on the importance of the bear market bottom period in the coming months, because we’re going to see a multi-year rally after that,” he concluded.
