A widely followed crypto analyst is warning of an imminent Bitcoin (BTC) correction based on historical market cycles.
Pseudonymous crypto trader Rekt Capital tells his 424,500 followers on the social media platform X that Bitcoin will enter the so-called “danger zone” today, when it might undergo a significant correction.
The trader says that historically, Bitcoin has severely corrected in the days leading up to the halving event, when miners’ rewards are cut in half. He estimates the next halving event will take place on April 15th.
“In two days [from March 17th], Bitcoin will officially enter the ‘danger zone’ (orange) where historical pre-halving retraces have begun. Historically, Bitcoin has performed pre-halving retraces 14-28 days before the halving.
In 2020, this retrace was -20% deep.
In 2016, this retrace was -40% deep.
[As of March 17th], BTC is 30 days away from the halving and has pulled back -11% [last] week.”
According to the trader, Bitcoin could dip to as low as the $40,000 range based on BTC’s price action during the 2016 and 2020 market cycles.
“20% from here [$65,348] would be interesting. That would be approximately $13,000 towards the downside, or a 30% retrace would be even deeper than that. It would get us down from current levels by approximately $21,000. And that’s pretty crazy to think that we could still get to $44,000.”
While Bitcoin may witness a deep pullback, the analyst says that the retracement will likely end up being a blip in the grand scheme of things.
“We are here (green circle). And if you can’t really see the recent dip that’s precisely the point of this post.”
Bitcoin is trading for $65,689 at time of writing, down nearly 3% in the last 24 hours.
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