Bitcoin repeats rare weekly chart signal that resulted in 50% BTC price dips
Bitcoin (BTC) is facing a rare chart phenomenon which has historically resulted in 50% price drawdowns, new data shows.
In a tweet on April 25, popular account Nunya Bizniz noted a fresh warning sign from two key moving averages on BTC/USD.
For only the third time in its history, Bitcoin’s 20-week and 50-week moving averages (WMAs) have both started to slope downwards.
While that may look harmless at glance, the result of the first two events — in late 2014 and late 2018 — was BTC/USD losing over 50%.
BTC weekly:On 3 occasions the slope of both the 20 & 50ma turned negative.The first 2 lead to 50%+ corrections.This time? pic.twitter.com/eIMsQ6dk8H
Both came at similar points in Bitcoin’s four-year halving cycles, and while slightly ahead of time, it has now been nearly as long since the 2018 dip, this bottoming out at $3,100.
“I think this chart draws valid parallels,” longtime commentator and macro investor Tuur Demeester commented on the findings.
In mid-March, the 20WMA crossed under the 50WMA, data from Cointelegraph Markets Pro and TradingView shows, in what is commonly known as a "death cross" move among chartists. Despite its name, the phenomenon has not always resulted in significant losses.
As Cointelegraph reported, consensus continues to form over a protracted period of price weakness for Bitcoin, which should come in line with a correction on heavily-correlated global stock markets.
Related: Bitcoin spoofs $39.5K breakout at Wall St open as Elon Musk Twitter takeover nears
The strength of the U.S. dollar in the face of anti-inflation maneuvers by the Federal Reserve is also in focus as a preemptive warning sign for those forecasting a shock event after two years of liquidity printing.
“DXY approaching multi-decade
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