How Does Current Bitcoin Rally Compare With Historical Ones?
22 Mai 2023 - 7:30PM
NEWSBTC
Here’s how the current Bitcoin rally stacks up against the previous
ones in terms of the drawdowns it has experienced so far. The
Current Bitcoin Rally Has Seen A Peak Drawdown Of -18.6% So Far In
a recent tweet, the on-chain analytics firm Glassnode compared the
latest Bitcoin rally with the ones seen throughout the entire
history of the cryptocurrency. Generally, rallies are compared
using metrics like the percentage price uplifts recorded during
them or the amount of time that they lasted (which may be measured
in terms of the blocks produced, as is done when looking at cycles
in terms of halvings). Here, however, Glassnode has taken a
different approach that provides a new perspective on these
rallies. The comparison basis between the price surges here is the
drawdowns that each of them experienced across their spans. Note
that these drawdowns aren’t to be confused with the cyclical
drawdowns that are used to measure how the price has declined since
the bull run top. The drawdowns in question are the obstacles that
the cryptocurrency encountered while the rallies were still
ongoing, and are hence, those that the coin eventually managed to
overcome. Related Reading: Prices Limit And Slow Down The Number Of
BTC ‘Wholecoiners?’ Here is a chart that shows the degree of
drawdowns that each of the historical bull markets experienced, and
also where the current rally stands in comparison to them: Looks
like the value of the metric hasn't been too high for the latest
rally so far | Source: Glassnode on Twitter The five bull rallies
here are as follows: genesis to 2011 (the very first rally),
2011-2013, 2015-2017, 2018-2021 (the last rally), and 2022 cycle+
(the ongoing one). The analytics firm here has taken the bottom of
each of the bear markets as the start of the next bull rallies.
This means that parts of the cycle that some may not consider as
part of the proper bull run are also included. The main example of
this would be the April 2019 rally, which is often considered its
own thing but is clubbed with the last Bitcoin bull market in the
above chart. From the graph, it’s visible that the deepest drawdown
that occurred during the first bull market measured around -49.4%.
The next run, the 2011 to 2013 bull, experienced an even larger
obstacle of a -71.2% plunge midway through it. The next one
(2015-2017) then only saw a drawdown of -36%, but the drawdown was
again up at -62.6% for the run that followed it (that is, the
latest bull market). Related Reading: Bitcoin Volatility Shrinks To
Historical Levels, Violent Move Incoming? So far in the 2022+
Bitcoin bull market (which would only be considered a bull market
at all if the November 2022 low was truly the cyclical bottom), the
deepest drawdown observed so far is the March 2023 plunge of
-18.6%. Clearly, the drawdown seen in the current rally so far is
significantly lesser than what the historical bull markets face. If
the pattern of the past runs holds any weight at all, then this
would mean that the current bull market should still have more
potential to grow. BTC Price At the time of writing, Bitcoin is
trading around $26,900, down 2% in the last week. BTC has been
moving sideways recently | Source: BTCUSD on TradingView Featured
image from iStock.com, charts from TradingView.com, Glassnode.com
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