A looming technical indicator called the “death cross” has ominous implications for Bitcoin, suggesting that bearish sentiment is building as Bitcoin has failed to recover from the May 19 market crash.
“Whenever a Death Cross occurs, BTC experiences deeper downside,” crypto trader and analyst Rekt Capital tweeted.
The death cross is a technical chart pattern indicating the potential for a major sell-off. The death cross appears on a chart when a stock’s short-term moving average crosses below its long-term moving average. Typically, the most common moving averages used in this pattern are the 50-day and 200-day moving averages.
Bitcoin was trading at $38,623.86 as of this writing, down about 40 percent from its all-time high of $64,829.14. That’s “nothing out of the ordinary for correction sizes,” Cryptopotato reported.” However, the foreboding technical signal could mean that there is a lot more pain to come.”
“By the way, $BTC formed a death cross Just saying”, Robert Mercer tweeted @Robert_Klondike.
Crypto analyst Rekt Capital compared the current Bitcoin market to the ones in 2013 and 2017: “When $BTC peaked in 2013, it took 135 days for the Death Cross to occur. When BTC peaked in 2017, it took 107 days for the Death Cross to occur. That’s 3.5 months. And during those 3+ months… Bitcoin dropped -70% from the $20,000 peak.”
The mini-rally in mid-2019 was similar, with the death cross showing up 149 days after the peak. By then, Bitcoin prices were down 53 percent. Another 55 percent price loss followed the death cross.
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“If history repeats, BTC could see its Death Cross occur sometime between very late July or in early September 2021,” Rekt Capital predicted.
CRYPTOMARKETXPERT tweeted a prediction that Bitcoin could drop to $8,600-to-$9,000. “As #bitcoin death cross looms history tells us deeper pull back is appearing on the cards $18K.That said, once the death cross formation completes I expect a further downside to occur targeting $8.6K ~ 9K. That’s a major level for a rally to the upside if there is enough fuel.”