Bitcoin (BTC) may be facing a significant correction after a major bearish technical signal appeared on the 3-day chart, increasing the possibility of a rally towards the $36,000 level.
According to insights from trading shots in TradingView According to the March 6 post, this outlook stems from the fact that the cryptocurrency formed a death cross on a three-day time frame.
Specifically, this pattern occurs when the 50-period moving average (MA50) is below the 200-period moving average (MA200). This signal has historically appeared during major bear cycles, often preceding an extended period of decline in crypto prices.
Based on historical data, every time this pattern has appeared during bear markets since 2014, Bitcoin has continued to fall sharply after the crossover.
After the signal formed during the 2022 market downturn and 2018 crypto winter, the asset fell by just over 52%. In the early 2014 cycle, the decline was even greater, reaching about 57%.
The current setup shows the MA50 declining and below the MA200, confirming a bearish crossover. Bitcoin is also trading below both trend lines after losing momentum around $70,000, a structure that historically indicates weakening market power.
The next lowest goal after Bitcoin
If this pattern follows previous cycles, Bitcoin could see a similar decline. A drop of approximately 52% from the crossover area would take the price to nearly $36,000, matching the 1.618 Fibonacci extension that marked the bottom of the 2018 and 2022 bear markets.
Based on this historical movement, analysts see the $40,000 to $36,000 range as a potential accumulation zone, with $40,000 coinciding with a Fibonacci extension and $36,000 reflecting the typical post-death cross decline seen in previous cycles.
The bearish outlook comes after the cryptocurrency soared to nearly $74,000 between March 4 and March 5, hitting a one-month high and temporarily boosting traders’ optimism.
The move was driven by a short squeeze, new inflows into spot Bitcoin ETFs, and a perceived resilience amid rising geopolitical tensions in the Middle East.
During the rally, Bitcoin also moved with the rise of the US dollar, which is an unusual correlation that has appeared since late 2024.
However, momentum quickly faded and the pullback wiped out most of this week’s gains.
Bitcoin price analysis
At the time of reporting, Bitcoin price was $67,955, well below its 50-day SMA of $75,548 and well below its 200-day SMA of $96,080.
Trading below both moving averages typically indicates bearish market conditions and indicates that the overall trend remains under pressure.
However, momentum indicators present a more balanced picture. Bitcoin’s 14-day Relative Strength Index (RSI) is currently sitting at 45.93, firmly in neutral territory. RSI measures the speed and magnitude of price movements on a scale of 0 to 100.
