The Bitcoin (BTC) price decreased significantly on May 19, falling to a low of $30,000.
However, it has bounced considerably since the lows, drawing comparisons to the recovery that transpired on March 2020.
Bitcoin drops to $30,000
BTC decreased considerably today, falling to a low of $30,000. This validated the $30,000 area as support, a level that previously had not been reaching since January 2020.
It has bounced since, creating a lower wick with a magnitude of 22.76%. Currently, it is attempting to reclaim the 0.5 Fib retracement support level at $34,375. Doing so would be an extremely bullish development, leaving a long lower wick in place.
However, there are slightly more than nine hours left until the daily candlestick closes.
Previous BTC corrections
Cryptocurrency trader @damskotrades outlined a BTC chart that showed the previous correction, which occurred in September 2020. It amounted to a drop of 40%.
With the low of $30,000, the current correction amounted to a drop of 53.74%. This decrease has transpired in 35 days.
The correction most similar to it in both magnitude and length was that in March 2020, when BTC decreased by 64% in 28 days. This led to a low of $3,782. What followed afterwards was a V-shaped recovery that led to the current bull run.
While the December 2017 correction was similar in length (70), it took 56 days to transpire. Therefore, the current correction is more similar to that on March 2020 than that of December 2017.
To conclude, the current BTC correction is very similar to that which occurred in March 2020, which led to the bottom of $3,782.
The recovery could follow a similar path if the price manages to close above the 0.5 Fib retracement level at $34,375.