The surge of the largest cryptocurrency in the market, Bitcoin (BTC), has caught the attention of investors and analysts, with many drawing parallels to BTC’s performance in Q1 2021. While the similarities are striking, some experts caution against assuming that history may repeat itself.
According to the market watcher Maartunn, Bitcoin’s current price action is showing similarities to its performance in Q1 2021.
Maartunn suggests that while it doesn’t necessarily mean that it will repeat itself, it’s important not to ignore the similarities between the current market conditions and those in Q1 2021, which could lead to increased volatility.
Bitcoin’s Bull Run Will Be Delayed?
According to what the market watcher Martunn has spotted in Q1 2021 and 2023 in response to another analyst, CryptoCon, a small, short-term correction in Bitcoin price may be necessary to fuel the current bull run.
This is common in Bitcoin’s cycles and typically happens after the price breaks above the 50 exponential moving average (EMA). After this break, Bitcoin typically experiences one retest during the entire bull run.
Retests of key support levels, such as those seen in Q1 2021 and potentially in 2023, are viewed as a healthy and necessary correction that can support years of gains for Bitcoin. CryptoCon believes that a correction in Bitcoin’s price could benefit the cryptocurrency’s long-term growth and the similarities between these periods.
By establishing a more sustainable trajectory, a correction could help to promote a more stable and sustainable market for BTC.
Key Supports For BTC In Case Of A Pullback
In the event of a pullback in Bitcoin’s price, it will be crucial for bulls to defend the levels of $24,000 and $25,000 to prevent further decline. This range has been an important accumulation zone for buying more Bitcoin in the current uptrend, which could help extend the rally and enable the cryptocurrency to break through the $30,000 level with strength.
However, In the event of a sell-off in Bitcoin’s price, where the cryptocurrency continues to decline below the $24,000 mark, it will be important for bulls to hold the lower levels of $21,000 and $19,000.
These levels are considered crucial support floors that could prevent a further decline in Bitcoin’s price in a worst-case scenario.
As of writing, Bitcoin’s price has remained relatively stable recently, trading at around $27,900. Despite this, Bitcoin is still hovering near an important resistance level at the $28,600 mark, which is seen as a major hurdle to clear before the cryptocurrency can breach the $30,000 level.
Overall, a short-term correction in Bitcoin’s price action should not be cause for alarm but rather seen as a normal and necessary part of the cryptocurrency’s market cycles.
Chart from Tradingview.