Death Cross has occurred and has merely affected the bitcoin price movement, is the danger still hovering over?
A Death Cross in bitcoin is a technical event that signals an upcoming Bearish Market, meaning trouble for Bitcoin. This is a cross-over of 50 days moving average and 200 days moving average, resulting in a -70% dip in 2018.
Bitcoin is trading $34510 right now and Still bitcoin price trading between a range-bound for 32 days. It’s hard to predict the price movement in the coming week and month but technically, the chart says a lot about price.
First, the death cross. The intersection of the 50 and 200 MA. Is this bearish or bullish in Bitcoin?
If we look at the last 6 years, of the 4 times this death cross occurred, there was the following drop at the time of the crossing and the rise or fall after:
- September 16, 2015 decreases 0% increase 123%
- April 2, 2018 decreases 3% increase 50%
- October 26, 2019, decreases 0% increase 16% After this increase followed by a decrease of 36%
- 25 March 2020 fall 13% rise after this fall of no less than 1033%
So bearish I absolutely cannot call this crossover, the effect is so delayed that it has probably long been incorporated into the price.
An analysis of Bitcoin is a bit more difficult at the moment because we are in the middle of the range. Reading the chart tell the followings:
- A completed bullish falling wedge with a breakout.
- A key level of 35000 which is also the very important 0.618 Retracement.
- It seems that we have set a double bottom at this 0.618 level
- I see the death cross as a neutral element but certainly not a more bearish one as evidenced by my data over the last 6 years.
- The price of Bitcoin is sitting as much as 25% below the 200 MA and that is a magnet that eventually pulls the price back in.
- The RSI on daily basis has not broken the rising support line. I expect a bounce here.
- New reversed head shoulder formations in the works (right shoulder currently)
- A mini reversed head shoulder formation with the neckline at the 0.5 Fib level. Target 38158.
A magic point is Jun 24, midnight when the neckline, resistance line, and rising trendline meet. Hopefully, this is the last week of bearish trends and we might see a pump next Monday if Bitcoin survives the Death Cross.
This is not an investment advice, DYOR.