Bitcoin price plummeted sharply today after trading in the narrow range of $8,000 level on Wednesday. The latest selloff isn’t due to ads bans, regulators clampdown or warnings; the downtrend was purely supported by traders concerns over the technical factors on price charts – market participants are predicting a massive crash in BTC price in the days to come, driven by a Death Cross trend. Bitcoin price declined more than 7% today, down 15% in the last seven days.
TV analyst Abigail Doolittle said, ‘the “death cross” trading data for bitcoin, suggests that we could see bitcoin go all the way back below $1,000 per bitcoin”.
A death cross trend happens when the 50-day moving average (MA) cuts the 200-day MA from the top – suggesting a considerable drop in price based on technical factors. Bitcoin price chart clearly shows that the 50-day moving average is likely to cut the 200-day moving average from the top, which is creating a long-term bearish pattern for BTC price.
“That being said, 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,” Jim Iuorio of TJM Institutional Services said.
Jim Iuorio’s concerns look undoubtedly true considering declining trading volumes and declining trader interest. Cryptocurrency markets are fumbling sharply over the last two months on regulators concerns and the use of digital currencies in illegal activities. Regulators all around the globe are creating their framework to get better control of crypto markets.
The U.K. has recently formed a task force to look at the pros and cons of cryptocurrency markets, while the U.S. regulators are also inspecting crypto markets to come up with strong rules and trading guidelines. However, the market participants aren’t yet sure how the new regulations would impact cryptocurrency prices.