Bitcoin Magazine Market Analyst, Sam rule, Tweeted a comparison chart of Bitcoin returns over the last four important peaks. The latest timeline of our current situation suggests that there are even more downsides.
The chart consists of a 2011 period ending 160 days later and a 93% drawdown. The period from 2013 to 2015. Finished after 410 days and 85% drawdown. And the 2017-2018 period, which ended 360 days later, and an 83% drawdown.
The current period from 2021 to 2022 is 220 days, a decrease of 69% from the peak in November 2021 so far.
Analysis of past Bitcoin lowdowns
Previous percentage drawdowns ranged from -93% to -83%, and the current “live” drawdown of -69% suggests that it needs to drop further before reaching the bottom. ..
By examining the percentage declines in sequence, you can see that the serious declines are gradually diminishing over each period. If the same pattern is played this time, a drawdown of about -80% may occur. This will bring Bitcoin to a bottom of about $ 13,800.
In addition, the above pattern shows that BTC becomes less volatile over time.
For the length of each drawdown period, the most extended period was the 2013-2015 phase, which is 410 days. However, there are no identifiable patterns extracted from the data.
Keep in mind that past events should not be seen as indicators of future performance. In addition, this method of analysis does not take into account the macroeconomic situation that contributes to the current period 2021 to 2022.
Macro image
Mainstream media reports mixed bags as far as the risk of recession is concerned.
for example, CNBC Recently, a commentary from Simon Baptist, Global Chief Economist of the Economist Intelligence Unit, was featured. Baptists reduce the risk of an imminent recession. Instead, he said the likely outcome is stagflation, which is characterized by rising costs combined with slowing economic growth.
again, CNBC Recently, Larry Davis, a former chief economist at the Securities and Exchange Commission, said it would be difficult to stop inflation and argued for a possible recession in the future. [by raising interest rates] Without falling into recession.
“There is a calculation day, how fast is the problem.”
in the meantime, Downy HawkinsA managing partner of Calit Advisors, said the recession may already be here, based on personal consumption.
“The real estate crisis of the 70’s and 80’s, and even the 9/11 terrorist attacks and financial crisis of 2008 were worse than we saw. Even those were as consumer as we see today. It wasn’t tough .. “
Squeezing household income usually results in spending behavior that prioritizes necessities. As a result, demand for Bitcoin and other non-essential items may decline.
