A cryptocurrency manager has allayed any fears investors may have had over the recent drop in the value of Bitcoin, acknowledging the market movement is consistent with the historical behaviour of this digital asset.
The value of Bitcoin experienced a jump of nearly 50 per cent in early November, taking it close to the $100,000 mark, but it has since steadied at $92,000.
According to BTC Markets head of finance Charlie Sherry, Bitcoin experienced the same phenomenon in 2021/21 where, after an 84 per cent surge, the digital asset went through an 11 per cent correction before rallying again. Later in 2021, a 25 per cent correction followed a rally of 142 per cent.
“These pullbacks are part of a cyclical pattern that reduces leverage and consolidates gains before pushing higher. The current drop to $91,600 fits this trend, suggesting it could be the ‘last flush’ before Bitcoin crosses the $100,000 mark,” Sherry noted.
“This pullback is consistent with Bitcoin’s behaviour during past bull markets. Corrections of 10 to 30 per cent are typical and they play a crucial role in shaking out over-leveraged positions, strengthening support levels and preventing unsustainable price surges.”
He suggested there were several factors behind the market correction, including the profit taking of investors after their recent strong capital gains and the psychological barrier of the $100,000 value milestone triggering caution among individuals and having them experience selling pressure from traders testing market resilience.
Further, he warned the current market correction may not be complete, meaning the value of Bitcoin could fall below $92,600 in the immediate future.
“Looking at past cycles, Bitcoin’s corrections have ranged from 11 per cent to 25 per cent. The current pullback is around 5 per cent from its recent high of $99,000, indicating it’s within the lower range of typical corrections,” he said.
“If the dip deepens, Bitcoin could test the $88,000 to $90,000 range, which represents solid support. A deeper correction of 20 per cent to 30 per cent could take Bitcoin closer to $80,000, still within the realm of normal market behaviour.”
On a positive note, he indicated it was possible the digital asset could reach the $100,000 valuation level in the coming weeks.
“Polymarket, a well-regarded prediction market, gives a 72 per cent chance that Bitcoin will hit $100,000 before Christmas, echoing the market’s optimistic sentiment. Given these odds, it’s reasonable to expect Bitcoin could break the $100,000 mark soon,” he said.
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