What is considered a normal pullback in a bull market? A comparison of Bitcoin bull market retracements in 2017 and 2021

Buying on dips and being greedy when others are fearful, these common and frequently occurring investment theories are extremely difficult to execute, mainly due to reasons such as "never knowing the bottom," "market sentiment being low," and "fear." We have compared the pullback situations during the 2017 Bitcoin bull market with this year's performance for reference.

Cryptocurrency Market

Last night on 4/22, Ethereum surged again, hitting a new all-time high of $2,646, but the market quickly reversed as news of Biden considering raising capital gains tax spread. Bitcoin dropped below the psychological barrier of $50,000, while Ethereum fell back to $2,250 before the deadline.

Generally, altcoins tend to have deeper drops than Bitcoin and Ethereum, but they also experience larger gains. For instance, Dogecoin, which had surged previously, dropped by 25% in the past 24 hours. Nevertheless, the potential returns of altcoins continue to attract many investors.

Bitcoin Bull Market Corrections in 2017

During the bull market cycle of 2017, Bitcoin experienced approximately six major corrections with an average decline of 35.95%. On average, it took 13 days to reach the "bottom" of a correction, with over 40% of the pullbacks occurring in June and September.

Bitcoin Bull Market Corrections in 2021

So far in 2021, there have been approximately five corrections with an average decline of 24.48%. It took an average of over 8.8 days to reach the "bottom" of a correction. Currently, it is possible that the correction has not yet reached its lowest point.

However, compared to 2017, this year's pullbacks can be considered minor. The largest correction of 31.57% occurred between 1/8 at $41,986 and 1/22 at $28,732. Unlike the pullbacks of over 30% seen that year, this year's bull market seems to have a more aggressive buying force, which is also quite friendly to Hodlers, with relatively small correction ranges.

Where is the Bottom for Bitcoin?

Previously reported, Weiss Ratings provided an opinion after the significant drop, stating that the market is still in the altcoin season. Most small coins are expected to outperform Bitcoin in the coming weeks. Regardless of Bitcoin's rise or sideways movement, it may help altcoins break through historical highs. Weiss Ratings also indicated a bottom price for Bitcoin between $46,000 and $48,000.

If the bottom is at $46,000, then this correction is close to 30%, second only to 1/8. The altcoin season emphasized by Weiss Ratings seems to be slowly brewing, as Bitcoin's market dominance has fallen to 49.9%, a situation that occurred in late May 2017.

Analyst Jack, often quoted, pointed out in his latest article that the range of $42,643 to $43,017.5 is a support level on the daily chart.

The selling pressure caused by Biden's proposed capital gains tax increase has also affected the US stock market, leading to significant declines in the major indices. Even recently listed Coinbase dropped below $300. Despite Ark Invest's repeated additions and positive outlook on Coinbase, it has not been able to prevent the decline.

Overall, the trajectory of this year's bull market resembles that of 2017 following Bitcoin's halving in 2016. However, upon comparison, the corrections this year are smaller. If history repeats itself, it suggests that Bitcoin's true correction has yet to occur.