BTC prices are currently down 12% from their all-time high of just above $108,000 on Dec. 17, and the correction appears to be deepening.
The asset hit an intraday low of $93,810 during trading in Asia on Monday morning but recovered quickly to tap $96,000 before another slip.
Those losses have resulted in a “bearish engulfing” weekly candle, as reported by crypto analyst “Rekt Capital.” All of the gains over the past month have now been wiped out in the correction.
“Bitcoin is showing increasing signs of transitioning into a multi-week correction,” he said.
Bitcoin has confirmed a Bearish Engulfing candlestick formation$BTC #Crypto #Bitcoin https://t.co/KnIptVe958 pic.twitter.com/XwUWCkjTvM
— Rekt Capital (@rektcapital) December 23, 2024
Bitcoin Corrections Are Normal
“Historically, week eight in Bitcoin price discovery tends to be a corrective week,” the analyst added while providing a comparison with previous market cycles.
In 2017, week nine was also corrective, but to a much lesser extent than week eight, he observed, before adding:
“Generally, once BTC clears the typically corrective weeks 7 and 8 – the retrace gets close to a bottom.”
It is also the worst week for the asset since Donald Trump won the US presidential election in early November. Additionally, the Federal Reserve’s cautious policy outlook has tempered optimism over Trump’s embrace of the crypto sector.
Nevertheless, BTC remains up more than 40% since Trump’s victory.
“We should hold the $90,000 level for Bitcoin into the year-end, but if we break below that could trigger further liquidations,” Sean McNulty, director of trading at liquidity provider Arbelos Markets, told Bloomberg.
Meanwhile, David Lawant, head of research at crypto prime broker FalconX, said the “low-liquidity environment may bring more volatility as we enter into the final days of the year.”
He pointed out that Dec. 27 will also likely see the biggest crypto options expiry event of its history, with almost $18 billion in notional value BTC and ETH contracts expiring.
Additionally, spot Bitcoin ETFs shed almost $950 million on Thursday and Friday as investors were rattled by the market pullback.
Some Altcoins Showing Recovery
There are a handful of altcoins showing minor bounces from their correction dips this Monday morning.
Solana (SOL) made 2.2% on the day to reach $186, Chainlink (LINK) was up 5.1%, topping $23, Toncoin (TON) made 3.5% to reach $5.50, and Stellar (XLM) was up 3%, trading at $0.363 at the time of writing.
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