Bitcoin’s 2024 Drop Differs From 2022 Crash, Analyst Says

As Bitcoin trades around $68,639, down from its recent peak, comparisons to its 2022 crash have proliferated across crypto Twitter. However, technical analyst Christopher Inks of TexasWest Capital contends these parallels are largely superficial. His core argument centers on market structure: the current move appears to be a completed five-wave decline, a pattern tied to a positioning washout. “One of the differences between the current drop off the ATH and the 2022 drop of ATH is that we just appear to have completed 5 waves down,” Inks wrote. This contrasts sharply with 2022, where, after a similar five-wave move, the market completed a three-wave correction and then broke down further into a deeper structural unwind.

The implication of a completed five-wave leg on the weekly BTCUSD chart is significant for sequencing. According to Inks’s analysis, this pattern suggests the next phase is typically corrective or dedicated to base-building, rather than an immediate continuation of the downtrend. He annotated a sharp recovery late last week followed by sideways consolidation around a “weekly pivot” as evidence of this potential shift. This technical perspective frames the selloff not as the start of a new bear market, but as a potential “terminal shakeout” within a larger bull trend, though Inks is careful not to declare a definitive bottom.

Beyond chart patterns, Inks emphasizes a fundamental divergence in the catalysts driving the two selloffs. The 2022 breakdown was precipitated by a market-structural crisis: the depegging of TerraUSD (UST). This event triggered a reflexive shock that tightened collateral and severely impaired liquidity across crypto venues, creating a forced selling spiral. “The former coincided with the TerraUSDT depeg and break down which was a market structural event that was the catalyst for the Bitcoin breakdown at that time,” Inks explained.

In stark contrast, he frames last week’s selling pressure as a deliberate “degrossing” event—a risk-off reduction of positions by traders. “These are two wholly different market moves,” Inks stated, characterizing the recent activity as “pre-resolution positioning rather than post-crisis fallout.” This distinction is crucial; a crisis-driven unwind can create lasting damage to market infrastructure and confidence, while a positioning washout is often a healthier recalibration within an ongoing trend.

While the analysis suggests a more benign outcome than 2022, Inks provides a clear, time-based roadmap for confirmation. He notes that Bitcoin failed to reclaim a weekly close back inside the prior range around $75,000, leaving the door open for further weakness. For the low to be validated, he wants to see it hold for “the next 2–3 weeks” accompanied by “declining volumes on the pullbacks.” Furthermore, he looks for the formation of a higher low on the weekly timeframe and “compression below resistance instead of rejection.”

Inks also points to macro correlations for supporting context. He highlights that two-year Treasury note futures, a key rates indicator, remained “coiled” rather than breaking higher during last week’s risk-off episode. This, in his view, bolsters the thesis that the selling was a tactical repositioning ahead of economic data, not a flight-to-safety crisis response. On lower timeframes, like the 1-hour chart, he advocates for patience as Bitcoin consolidates. “Takes time to build confidence after something like that,” Inks wrote, adding that a slow base-building process is preferable to a sharp, unsupported rally for establishing a durable foundation.

Inks concludes with a caution against superficial historical comparisons. “Does this guarantee that the low is in? Of course not, but if you’re comparing two events then you should compare how they occurred and not just that the price action looks kinda similar,” he advised. His final point is a warning to market participants: understanding the underlying mechanics prevents confusion and unfounded accusations of manipulation if price action diverges from simplistic historical analogies.