BTCBull Market also has risks? Inventory pullback 3 major time points, when did the most disastrous big dump occur?

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The drastic Fluctuation of BTC has already taught us to "accept the inevitable".

We seem to have become accustomed to such an expectation: even in a thriving Bull Market, it is inevitable to encounter a significant pullback that shatters our hopes, dreams, and Wallet balance.

Therefore, we all think that BTC suddenly big dump 50% in the process of sprinting to six digits or even higher prices, and this idea is totally understandable.

Does this expectation make sense?

First of all, it needs to be clear that BTC did experience about 80% 'traditional' big dump from the peak of the bull market to the bottom of the Bear Market. Since the first significant rise of BTC in 2011, almost every cycle has been like this without exception.

However, this article is not discussing the pullback in a bear market (for that, you can refer to our previous analysis). Instead, we will focus on the pullback during a Bull Market, just like the situation we are currently experiencing.

The chart below shows the price performance of BTC over six different time spans, ranging from three days to three months, presented in a rolling manner from cycle start (bottom) to historical peak (top).

Each line represents a time span. For example, the deep purple line represents the percentage difference between each daily low and the opening price three days ago, while the green line represents the comparison of the same type with a three-month cycle.

Image Source: TradingView

The dashed line at the bottom represents the 50% retracement level. As shown in the chart, there has never been such a large retracement during the Bull Market from August 2015 to December 2017.

During this period, the most significant pullback occurred in late September 2017, with a 40% decline within two weeks.

However, in the subsequent bull markets from 2018 to 2021, there were three significant pullbacks of more than 50%.

One of them was the market crash triggered by the epidemic in March 2020, when the stock market experienced a series of 'Black Monday'.

BTC has fallen by 50% or more in almost all time spans, with only a three-month period slightly below 50%, at 47%.

The other two major pullbacks occurred in May and July 2021, when BTC fell from its all-time high of over $60,000 to $30,000. However, in the following four months, BTC quickly rebounded to a new high of nearly $69,000.

Image Source: TradingView

This pullback was relatively mild, and the most significant correction in the Bull Market occurred in the first week of August.

BTC has fallen 30% in multiple time cycles, dropping from a high of over 70,000 US dollars in June to a low of 49,200 US dollars.

Of course, this does not mean that Bitcoin has lost its volatility. I still believe that the future market will continue to fluctuate.

It is worth noting that the most severe drawdowns in history often occur at the end of a Bull Market.

Therefore, the longer the Bull Market continues without a significant pullback, the more uncertain the future trend becomes, which also adds to the unique 'thrill' of investing in BTC.

Disclaimer: The market carries risks, and investment should be cautious. This article does not constitute investment advice, and users should consider whether any opinions, perspectives, or conclusions in this article are suitable for their specific circumstances. Investing based on this is at your own risk.

This article is authorized for reprint from: 'Foresight News'

Original author: David Canellis

"Is there a crisis in the Bitcoin bull market? Checking for pullback at 3 time points, when does the worst big dump happen?" This article was first published in "encryption city".

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