Bitcoin is not expected to retest its record until later this year, but data shows this correction could get uglier before a recovery begins — similar to how the cryptocurrency fared between two all-time highs in 2021.
A bitcoin valuation indicator, CryptoQuant's Bitcoin Profit and Loss Index, is currently hovering around its own 365-day moving average.
"Bitcoin is at a level where a local bottom can form or a major 'summer of 2021' style correction can occur," said Julio Moreno, CryptoQuant's head of research.
"Prices have typically bottomed out when traders' margins touch extremely negative levels as seen currently."
Bitcoin is currently retesting key support at $57,000 for a third day after sliding below that level last week.
Persons:
Bitcoin, Julio Moreno, CryptoQuant's, Moreno
Organizations:
Traders