- Bitcoin has charted a so-called death cross with recent the drop to $7,400. The bearish cross comes as a result of the 47 percent slide from the 2019 high of $13,800, and as such is a lagging indicator.
- Historical data shows BTC tends to bottom out after a death cross.
- The cryptocurrency has picked up a bid at press time, but is yet to invalidate the bearish case with a move above the Sept. 30 low of$7,714.
A long-term bitcoin price indicator has turned bearish, courtesy of the cryptocurrency’s sharp drop in the last four months.
The 50-day moving average (MA) of bitcoin’s price has crossed below the 200-day MA today, confirming a “death cross” for the first time since March 31, 2018, according to Bitstamp data.
The long-term bearish cross is preceded by a sharp drop from the 2019 high of $13,880 seen on June 26 to the low of $7,293 seen on Oct. 23.
To put it another way, the death cross is the product of the 47 percent slide from the high of $13,880. After all, the 50-day MA responds to the data that is at least 2.5-months old and the 200-day MA is sensitive to 6.5-month old data.
BTC topped out at $13,880 on June 26 and fell back to $9,000 in mid-July. The 50-day MA, however, continued to rise and topped out in mid-August, that is, 1.5-months after BTC topped out above $13,800.
Meanwhile, the 200-day MA maintained an upward trajectory throughout the sell-off from $13,880 to recent lows below $7,300.
As of now,