On Thursday, Bitcoin experienced a nauseating drop in price as the coin shed about 50 percent in value in less than 24 hours. This followed a few drops in the market at the end of February as global market fears started to escalate.

In the traditional markets, institutional investing has been hit hard as stocks, bonds, commodities and even gold have been slammed by fears surrounding Covid-19 and its impact on the global economy. Bitcoin has also been exposed as a tool of the institutional market and thus has suffered the whims of extreme fear in investing during this crisis.

Volatility has been rife with the dropping of price as Bitcoin rebounded and fell like a rubber ball, moving a few hundred dollars every few minutes. However, a few days have now past since that bloodshed and the market seems to be taking a break. Bitcoin’s price has steadied above $5,000 having hit a low of $3,800.

It is now time to take stock of what this drop means for the general Bitcoin market and the future of the price action through the Covid-19 fear, as well as after this passes. Surprisingly, even with this unprecedented downward trend, there are some positives to take.

Bitcoin is used to this

If there is one positive to take out of this, it is that Bitcoin is used to volatility, and it is no stranger to shedding huge amounts of its value in short spaces of time. More so, because Bitcoin is generally on an upward trajectory in the long term, there is the sentiment around buying Bitcoin on ‘special.’

The current prices represent a huge buying opportunity, however, the extreme fear in the market, however, could be affecting people rushing to invest — both in terms of institutional investors, and crypto-focused ones. However, markets analyst filbfilb, who noted that buying appetite was back on exchanges, but the relief seen on the markets may be short-lived.

Late Friday, he told subscribers of his Telegram trading channel:

“Bid side of the orderbook has massively recovered. I certainly don’t think we are out of the woods but a squeeze up looks logical to me.”

There has been no squeeze to note thus far, but one analyst looking at the positives is PlanB, the creator of the stock-to-flow Bitcoin price model. He noted that at around $5,000, BTC/USD was still well within its expected range.

“Some people think S2F model broke yesterday. Of course it did not,” he tweeted.

“#bitcoin oscillated nicely around model value and stayed well within model bands. The extreme volatility within the model bands shakes out the weak hands. No extreme returns without extreme risk (volatility).”

