Bitcoin could be heading for a 'summer of 2021 style' correction between record highs, data shows

Bitcoin isn't expected to retest its record until later in the year, but data shows this correction could get uglier before a recovery begins.

Bitcoin isn't expected to retest its record until later this year, but data shows this correction could get uglier before a recovery begins — similar to how the cryptocurrency fared between two all-time highs in 2021. A bitcoin valuation indicator, CryptoQuant's Bitcoin Profit and Loss Index, is currently hovering around its own 365-day moving average. This key threshold helps traders determine whether bitcoin is in a bull or bear market.

"Traders' unrealized margins are now -17%, the most negative since shortly after the FTX exchange collapse in November 2022," he added. "Prices have typically bottomed out when traders' margins touch extremely negative levels as seen currently." Bitcoin is currently retesting key support at $57,000 for a third day after sliding below that level last week.

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