Bitcoin Reflects the Scope of Historical Retreat – A Healthy Adjustment or Trouble Ahead?

Bitcoin is facing strong volatility again after losing the $110,000 mark just a few days ago, an incident that has caused instability across the market. Buyers are trying to reclaim this important support level, but fears of a deeper correction continue to weigh on market sentiment. With each failed bounce back, traders are left wondering whether this pullback is merely a pause in the broader uptrend or the beginning of a larger downtrend. Cryptocurrency analyst Darkfost has shared new data providing context for the current situation. Since the most recent all-time high of Bitcoin near $123,000, the coin has fallen by approximately -12%. According to Darkfost, this move still falls within the bounds of a normal correction, especially when compared to historical pullbacks in previous bullish cycles. Such corrective phases are often healthy, helping to reset leverage, cool off overly enthusiastic sentiment, and create new entry points for long-term investors. Although volatility remains in the short term, history shows that the current pullback of Bitcoin does not necessarily signal the end of the cycle. Instead, it may represent a period of stability before the next major move. The Adjustment of Bitcoin Fits Historical Patterns According to Darkfost, the current downtrend of Bitcoin should be viewed in the broader context of this cycle rather than as a sign of structural weakness. Looking closer, since the first all-time high in March 2024, the largest decline recorded so far has reached 28%. Importantly, Bitcoin has never corrected deeper than that during the ongoing bull market.

Historically, the most severe pullbacks during bullish phases often average between -20% and -25%, placing the current volatility within the expected range. With Bitcoin currently down about 12% from its recent all-time high of $123,000, this pullback remains modest compared to previous cyclical adjustments. Darkfost emphasizes that this behavior is not unusual and could even extend further without breaking the underlying bullish trend. In fact, such price drops are often healthy and necessary in a long-term upward trend. They serve multiple functions: eliminating excessive leverage in the derivatives market, cooling off overly bullish sentiment, and removing short-term speculators. At the same time, they create new entry opportunities for investors who may have missed earlier bullish phases. For long-term holders and institutions, these phases are less panic-driven and more about preparation. Historically, similar corrections often happen before Bitcoin bounces back strongly, when the price of Bitcoin stabilizes before continuing its upward trend. If the current pattern continues to hold, this pullback could ultimately strengthen the market foundation, setting the stage for the next growth phase. Check Recovery Level After Deep Fall Bitcoin is making an effort to bounce back after a strong correction that caused the price to fall to the 108,000 dollar range. As shown on the chart, BTC recently bounced back above 110,000 dollars but is still struggling to maintain its upward momentum. Being rejected from the 123,000 dollar range marked the most recent all-time high of the cycle, and since then the market has entered a retracement phase.

The 12-hour chart shows that BTC has fallen below the 200-day moving average (red line) but quickly bounced back, indicating that the bulls are still defending this important support level. However, the 50-day moving average ( blue ) and the 100-day moving average ( green ) are on a downtrend, indicating that pressure still exists in the short term. BTC will need to bounce back to the 112,000–115,000 dollar range to bring sentiment back to a bullish trend. The negative aspect is that losing the level of 108,000 dollars could open the door for a deeper correction to the level of 105,000 dollars or even the area of 101,000 dollars, where the 200-day MA serves as the last line of defense. Bitcoin is consolidating in a fragile position. A decisive move above $115,000 could reignite the bullish momentum, but failing to hold the current support level could confirm a prolonged correction before reaching any new all-time highs.