Bitcoin's $70K Retracement: A Natural Correction in a Bull Market, Say Analysts

Bitcoin’s recent price pullback to around $80,700 has led to concerns among investors about the potential onset of a bear market. However, analysts suggest that this retracement, possibly dipping to $70,000, is simply a natural correction within the broader bull market cycle.

Bitcoin (BTC) dropped more than 14% over the past week, following the March 7 executive order from President Donald Trump, which outlined a plan to create a Bitcoin reserve using cryptocurrency forfeited from criminal cases. The market had expected more direct federal involvement in Bitcoin, which led to a dip in investor sentiment.

Despite this downturn, Aurelie Barthere, principal research analyst at Nansen, a leading crypto intelligence platform, emphasized that the current price correction is part of a "macro correction" in the broader market, and is expected to be a temporary phase in the ongoing bull market. "This is a macro correction,” Barthere told Cointelegraph. “We have to monitor Bitcoin. The next level will be $71,000 to $72,000, the top of the pre-election trading range.”

A Healthy Market Correction

Barthere noted that while many cryptocurrencies, including Bitcoin, have broken key support levels, this retracement is typical for markets adjusting to macroeconomic conditions. She added that global markets, including U.S. stocks and crypto, are grappling with uncertainty related to tariff issues and fiscal cuts, as well as growing recession fears. However, she remains optimistic about the long-term bull trend.

This sentiment is echoed by other market observers, including Iliya Kalchev, dispatch analyst at digital asset investment platform Nexo. Kalchev suggested that a deeper retracement into the "low $70,000s" could create a solid foundation for a sustainable recovery. “A pullback in this range would provide a better base for future growth,” Kalchev told.

Normal for Bull Markets: A 36% Correction

Notably, Arthur Hayes, the co-founder of BitMEX and chief investment officer at Maelstrom, emphasized that Bitcoin’s potential retracement to $70,000 would still be within the normal range for a bull market. In a post on March 11, Hayes reminded followers: “Be patient. $BTC likely bottoms around $70k. A 36% correction from $110k ATH is very normal for a bull market.”

Hayes pointed out that such corrections are not unusual, particularly in volatile markets like Bitcoin. He referred to Bitcoin's price action during previous bull markets, noting that corrections of this magnitude have often occurred before the asset resumed its upward trajectory.

The Impact of Quantitative Easing

The recent market movements also align with broader economic trends. Hayes highlighted the role of quantitative easing (QE) in driving Bitcoin’s price higher during past cycles. From March 2020 to November 2021, Bitcoin surged more than 1,050%, rising from $6,000 to a peak of nearly $69,000. This dramatic rally occurred alongside the Federal Reserve's $4 trillion asset purchasing program, which included buying U.S. treasuries as part of its COVID-19 response.

Historically, quantitative easing has been a positive driver for Bitcoin's price, and many analysts believe that continued economic stimulus, along with a recovering global economy, could set the stage for further price increases in the coming months.

Conclusion: Bull Market or Bear Market?

Despite the recent downturn, analysts agree that the retracement to $70,000 should be viewed as a healthy correction in the context of a broader bull market. While Bitcoin may face some short-term volatility, the long-term outlook remains positive, particularly if the macroeconomic conditions continue to favor digital assets like Bitcoin.

As the market adjusts to both internal and external pressures, investors are advised to maintain a patient approach and focus on the bigger picture—Bitcoin’s potential for long-term growth within the larger financial ecosystem.