Bitcoin Bulls Smash Historical Norms, Deflect Major Price Correction

Despite significant profit-taking at record highs, Bitcoin (BTC) sellers have been unable to initiate a significant correction exceeding 20% during the current bull market cycle, an analysis by on-chain analyst Checkmate reveals. This contrasts with previous bull markets, where pullbacks of over 50% were observed.

Bitcoin Bulls Defy Historical Patterns, Staving Off Major Correction

In a groundbreaking analysis that challenges conventional wisdom, market experts have determined that Bitcoin (BTC) sellers have been unable to ignite a substantial correction, a deviation from historical bull market trends.

Data presented by Checkmate, the pseudonymous lead on-chain analyst at Glassnode, reveals that BTC price drawdowns have barely surpassed 20% during this cycle. This stands in stark contrast to previous bull markets, which witnessed pullbacks exceeding 50%.

"The market is absorbing substantial sell-side days worth hundreds of millions of dollars, yet the bears have still not managed to engineer a 20% pullback," Checkmate remarked, highlighting his astonishment at the unprecedented resilience of Bitcoin bulls.

This departure from historical norms has raised eyebrows among analysts. Despite mass profit-taking and reactionary selling at record highs, the market has remained remarkably buoyant. The lone exception was a brief 20% dip in mid-September 2023, while subsequent drawdowns have remained below 16%.

"This is still my favorite Bitcoin chart of this cycle," Checkmate proclaimed.

The absence of a significant correction defies statistical probabilities, as Checkmate acknowledged. "The insight is less about whether we will get one, but rather about the remarkable fact that we haven't already," he stated.

The strength of Bitcoin bulls stems from a fundamental shift in market dynamics in 2024. Notably, the advent of United States spot Bitcoin exchange-traded funds (ETFs) has introduced a significant source of buy-side support. Since their launch in January, these ETFs have accumulated over 500,000 BTC.

This institutional demand, coupled with phenomena such as multi-year lows in exchanges' BTC balances, has injected a surge of bullish sentiment into the market, setting the stage for a resumption of price discovery.

However, analysts caution against excessive optimism. Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, emphasized that ETF products will inevitably experience periods of net withdrawals, which is a normal aspect of investor behavior.

"The inflows have been that epic, and without the ETFs, BTC is probably around $30k, so look at the big picture," Balchunas advised in a tweet.

The exceptional resilience of Bitcoin in this cycle, defying historical patterns and statistical likelihood, underscores the transformative impact of institutional adoption and the growing recognition of Bitcoin as a legitimate investment asset.