A closely followed crypto analyst is warning that Bitcoin (BTC) may witness a deep corrective move if a historical pattern plays out.
Trader Ali Martinez tells his 38,700 followers on the social media platform X that Bitcoin tends to go through a significant pullback after recovering from a bear market.
[adinserter block="1"]According to Martinez, Bitcoin followed the same pattern after igniting big rallies in 2016 and 2019.
“In 2016 and 2019, after finding a market bottom, Bitcoin’s first major correction occurred upon reaching the 0.786 Fibonacci retracement level.
Drawing from this pattern, if history repeats itself, BTC may climb further toward $50,000 before experiencing a 40% correction.”
Should the same pattern play out, a 40% correction from the $50,000 level could see Bitcoin plunging toward $30,000.
At time of writing, Bitcoin is trading for $42,281.
While Martinez is sounding the alarm over a possible major correction for Bitcoin, he remains long-term bullish on the top crypto asset by market cap. Martinez says he sees the Bitcoin bull market enduring until the end of 2025 based on BTC’s halving cycle.
The halving, which cuts BTC miners’ rewards in half, is slated for April 2024. The event has also historically coincided with Bitcoin bull markets.
Says Martinez,
“Bitcoin [is] designed around four-year cycles, driven by its halving events, which often mirrors its price action.
Historically, this translates to three years of bullish trends followed by one year of bearish correction. As per this cycle, BTC is in an upward phase, potentially extending until December 2025!”
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