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Market Musings

Bitcoin Price Returns to $50,000 as 'Healthy Correction' Brings Relief

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Published on:
February 24, 2021

Some analysts are even describing Tuesday's pullback as "relatively modest" in historical terms.

Bitcoin Price Returns to $50,000 as 'Healthy Correction' Brings Relief

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Bitcoin is regaining strength after Tuesday’s stomach-churning plunge — gaining 12.5% at one point to hit highs of $51,290.14.

 

At the time of writing, $50,000 is proving a tough nut to crack, with the world’s biggest cryptocurrency trading ever so slightly below this level.

 

As you’d expect, many cryptocurrency enthusiasts are describing the recovery as a “healthy correction” — subscribing to the view that prices need to retreat in order go forwards.

 

Indeed, it seems many traders used the worst plunge seen in 2021 to “buy the dip” — snapping up a larger chunk of Bitcoin while it was less expensive.

 

MicroStrategy and Square were just two of the companies to announce that they have added to their crypto war chests over the past 24 hours.

Was This a Minor Correction?

The crash may have broken records in dollar terms — but when measured as a percentage, Bespoke Investment Group described the plunge as “relatively modest.”

 

In a blog post, its analysts said the average drawdown from all-time highs over the past six years has tended to be 35% for Bitcoin — twice as much as the 17.4% seen this week. They added that, even after the plunge, BTC is 34% above its 50-day moving average… and more than 167% above the 200-day moving average.

 

Inevitably, altcoins are also back in green territory. Ether is up 4.75% over the past 24 hours to hit $1,661.22 — but it’s still 4.67% off where it was a week ago.

 

There’s also hope that Binance Coin’s bullish run is about to resume. BNB is up 10.54% over the past 24 hours, returning above $250. Over the past seven days, the altcoin has gained a staggering 75% — cementing itself as the world’s third-biggest crypto once again.

 

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