Bitcoin price had another roller coaster performance last week, surging above $113,000 by mid-week before falling back to around $107,000. Although the price movements of top cryptocurrencies have stabilized over the past few days, market uncertainty still seems to be the order of the day.
However, the Bitcoin price appears to be leaning more towards a bearish setup, as evidenced by negative shifts in related technical indicators over an extended period of time. Here’s what happened to the BTC price the last four times this indicator turned bearish:
BTC Price At Risk Of 70% Correction: Analyst
In a post on social media platform The online expert said the market leader may have returned to a familiar position that has often led to significant losses (about 70%) in the past.
These bearish predictions are based on changes in the moving average convergence/divergence (MACD) indicator, which shows the relationship between moving averages of asset prices (in this context, the Bitcoin price). Typically, the crossing of the MACD line above the signal line is a bullish signal for the asset price.
Meanwhile, when the MACD line crosses below the signal line, it indicates that the asset is adopting a bearish structure. As you can see in the highlighted chart, the Bitcoin MACD line has crossed below the signal line on the monthly timeframe. This means that the flagship cryptocurrency may be prepared for a prolonged downward price movement.
Source: @ali_charts on X
What’s even more surprising is the historical performance of the Bitcoin price whenever this MACD crossover occurs. According to Martinez, the price of BTC has fallen by an average of 70% in the last four cases, and this indicator has turned negative.
The last time the moving average convergence/divergence indicator showed a downward trend was in September 2021, and in November 2022, the market leader began to decline to around the $16,000 level. As you can see from the chart, the price of Bitcoin fell by more than 70% during this period.
If history is anything to go by, this means the BTC price is at risk of a 70% decline over the next few months, with the target reaching around $33,000 at the current price point.
Bitcoin price at a glance
As of this writing, the BTC price is around $110,540, with no significant changes over the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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