Another one “Bit” the dust: Is it time to hit the Bitcoin panic button?
You definitely want to keep an eye on how that Bitcoin (BTC) price chart is moving.
Analysts are, and they keep pointing to a very dangerous trajectory they know that spells doom to the crypto, as it did for others before it.
It’s ominously called the “Death Cross” and that’s when Bitcoin ‘bites’ the dust.
Alright, let’s explain by looking at performance.
Cryptocurrencies went from green yesterday, breaching the $8,000 level, back to red today in the $7,400 range after sell-off.
BTC is negatively influenced by bear sentiments and pessimistic reports from regulators and advertisement companies, raising questions over the credibility of crypto markets.
Fortune reported that Reddit, one of the most active hubs of Bitcoin enthusiasts, has dropped its support for the cryptocurrency.
“The widely read social media site will no longer accept Bitcoin as payment for its Reddit Gold program,” reports Fortune.
“Reddit Gold, the site’s premium membership, lets users disable ads, customize their avatar, and access a private subreddit for about $30 per year. The site has accepted Bitcoin as a payment for the perk since 2013.”
According to Cryptocurrencynews, BTC price declined close to 11% in the past seven days, due to the impact of the Twitter ad ban.
BTC is down more than 60% in the past 3 months.
“Some analysts predict the crypto market volatility to extend in the next six months,” said Cryptocurrencynews.
Some still hopeful
Forbes went against the grain predicting BTC price at $20,000 is not a question of if, but rather when.
“Morgan Stanley has some good news for Bitcoin bulls, however: The 70 percent decline (in Bitcoin price) is “nothing out of the ordinary,” and what’s more, such corrections “have historically preceded rallies.”
Forbes said research firm Fundstrat affirmed the worst of the pain could be “largely over.”
“In June 2011, Bitcoin peaked at nearly $30 and found a bottom of $2.02 five months later, in November. It would be an additional 15 months before it returned to its former high,” reports Forbes.
“This might seem like a long time to some, but investors who managed to get in at the bottom would have seen their position grow more than 1,300%.”
CNBC said BTC is nearing a ‘death cross’ on the charts. It is scary.
It explains that the term is used to describe a crossover of the 50-day moving average and the longer-term 200-day moving average.
“More specifically, it’s used to illustrate when the 50-day moving average moves below the 200-day moving average, with technicians often looking at this pattern as a bearish sign of what’s to come,” CNBC says.
How close are we?
“The BTC 50-day moving average has already taken out the 100-day average, with the shorter-term trend line inching lower,” reports CNBC.
Jim Iuorio of TJM Institutional Services wrote to CNBC on Wednesday saying: “Any time the 50-day crosses the 200-day, it should flash a warning…and when you couple that with the fact that bitcoin has been trending steadily lower since the launch of futures, I think that it is a major negative,” he adds.
CNBC said the last time the death cross pattern occurred for bitcoin was in September 2015. After the death cross, bitcoin rallied close to $500 by early November that year from around $230.