Bitcoin isn’t expected to retest its record until later this year, but data suggests the correction could get worse before a recovery begins — similar to how the cryptocurrency has been between two all-time highs in 2021. A bitcoin pricing indicator, CryptoQuant’s Bitcoin Profit and Loss Index, is currently hovering around its own 365-day moving average. This key level helps traders determine whether bitcoin is in a bull or bear market. Historically, bearish crossovers of the indicator have marked major corrections, including the one from May to July 2021 and the one from November to December 2021 of the same year. At the same time, however, the trading range has become extremely negative, which could be seen as a potential signal of a bottom. “Bitcoin is at a level where a local bottom could be in or a major ‘summer 2021′ style correction could occur,” said Julio Moreno, head of research at CryptoQuant. “Traders’ unrealized profit margins are currently -17%, the most negative since shortly after the FTX exchange collapse in November 2022,” he added. “Prices typically bottom when traders’ profit margins reach extremely negative levels like they are now.” Bitcoin is now retesting key support at $57,000 for the third day after falling below that level last week. The price of the leading cryptocurrency has been in steep decline since March when it hit a record high of over $73,000 and quickly corrected. Since then, the cryptocurrency has struggled to return to those highs. Even as prices have cooled, demand for bitcoin has been on an upward trend since May, based on the growing number of whales holding the cryptocurrency. However, Bitcoin network activity suggests the token still has some headwinds. “Stablecoin liquidity has yet to accelerate, which is a necessary condition for a bull run,” Moreno said. “Although there has been some positive movement in the stablecoin market through [USD Coin]corresponding growth deficit in USDT [Tether] Market capitalization could delay or reduce the potential for significant bitcoin price appreciation. Furthermore, medium and large bitcoin miners are still selling a portion of their holdings.”