Over the past few days, crypto markets have tanked 15% with more than $350 million exiting the space.
Monthly support levels have been broken sending crypto assets to their lowest levels since late February as bearish sentiment returns.
However, the 28% market correction is nothing new and has happened several times during every market cycle.
Crypto Corrections Are Normal
Cryptographer and Bitcoin pioneer Adam Back said that prior bull runs had around half a dozen 30% drawdowns.
“In fact if anything, recent draw-downs seem to be less deep, but people forget the normal bull market pattern,” he said before advising against panic selling.
reminder, zoom out. prior bull runs had half a dozen -30% draw downs too. we’re at about -26% (-27% earlier).
in fact if anything, recent draw-downs seem to be less deep, but people forget the normal bull market pattern. don’t panic, buy the dip. or buy a bit of $CMSTR with… pic.twitter.com/vBOjFN1TOn
— Adam Back (@adam3us) July 5, 2024
“History is repeating as we speak,” observed analyst ‘Rekt Capital’ who added that if patterns repeat, “Bitcoin could peak in this cycle in mid-September or mid-October 2025.”
He suggested that this correction is needed for market cycles to resynchronize with historical patterns.
“The longer Bitcoin consolidates after the Halving, the better it will be for resynchronising this current cycle with the traditional Halving cycle.”
Capriole Fund founder Charles Edwards commented that this market correction was “well overdue” following “Bitcoin’s all-time longest winning streak.”
Analyst and trader ‘il Capo Of Crypto’ told his 859,000 followers on X “At this point where many are panicking and selling, I don’t think it’s appropriate to flip bearish/sell. It’s time to zoom out and keep a cool head.”
Massive Opportunity
Crypto analyst Miles Deutscher commented, “This is one of the most obvious long-term setups I’ve ever seen.”
He acknowledged the short-term selling pressure from the Mt. Gox redemptions and the German government offloading the asset.
However, he also observed several longer-term bullish factors such as institutional buying via Bitcoin and Ethereum ETFs, an upcoming election in the United States that could shift the crypto outlook, and a $16 billion payout to customers from FTX.
“Feels like a massive opportunity,” he said.
Reflexivity Research co-founder Will Clemente added that with late-year seasonality and an election, liquidity is presumably on crypto’s side. “There will no longer be major supply overhangs that have been looming over the market for years,” he added in reference to these redemptions from defunct exchanges and government selling.
The flip side of the panic around Gox/Germany/Silk road BTC coming onto the market is that come late Q3/Q4 with seasonality, election, liquidity presumably on crypto’s side, there will no longer be major supply overhangs that have been looming over the market for years.
— Will (@WClementeIII) July 5, 2024
In a post on X on July 5, Bitcoin pioneer Samson Mow said that there was no need to panic because the selling pressure was negligible.
“Max pain is weak hands selling their Bitcoin now, expecting a long drawn-out wave of selling from Gox and Germany, but that sell pressure turns out to be negligible.”
Crypto markets have lost 15% so far this month with total capitalization falling to just over $2 trillion in a four-and-a-half-month low.
Binance Free $600 (CryptoPotato Exclusive): Use this link to register a new account and receive $600 exclusive welcome offer on Binance (full details).
LIMITED OFFER 2024 at BYDFi Exchange: Up to $2,888 welcome reward, use this link to register and open a 100 USDT-M position for free!
The post appeared first on CryptoPotato
