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Bitcoin's `Death Cross' Looms as Strategist Eyes $2,800 Level

CryptocurrencyMar 19, 2018 03:31AM ET
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© Bloomberg. Two coins representing Bitcoin cryptocurrency sit on a computer circuit board in this arranged photograph in London, U.K., on Tuesday, Feb. 6, 2018. Cryptocurrencies tracked by Coinmarketcap.com have lost more than $500 billion of market value since early January as governments clamped down, credit-card issuers halted purchases and investors grew increasingly concerned that last year’s meteoric rise in digital assets was unjustified.

(Bloomberg) -- The tea leaves don’t bode well for Bitcoin.

Traders who look for future price direction in chart patterns are finding more indicators suggesting the world’s largest digital currency may have further to fall.

Bitcoin’s 50-day moving average has dropped to the closest proximity to its 200-day moving average in nine months. Crossing below that level -- something it hasn’t done since 2015 -- signals fresh weakness to come for technical traders who would dub such a move a "death cross." Another moving-average indicator of momentum has already turned bearish.

While many cryptocurrency investors don’t follow technical analysis, the digital-coin universe is drawing interest from professional traders who pay growing attention to the indicators, after the token vaulted to a record in December.

“There’s been a definitive shift over the past couple of months after the bubble activity at the end of 2017,” said Paul Day, a technical analyst and head of futures and options at Market Securities Dubai Ltd.

The strategist studied the virtual currency’s 2013 tumble for clues on how it may act this time round. His conclusion? Gear up for a 76 percent tumble from late February highs, which would take Bitcoin to a paltry $2,800, if the downtrend is repeated.

Another gauge that suggests weakness is the moving average convergence-divergence indicator, which measures price momentum to flash buy and sell signals.

Regardless, Bitcoin investors had better make peace with volatility.

When the currency’s 50-day moving average last hovered below the longer measure, during the first 10 months 2015, its performance was lackluster. It fell 5.2 percent in that period, and then rallied 43 percent through year-end from the day it broke back above the resistance level.

It has remained above that line ever since 2015 and racked up three successive annual gains in the process.

Bitcoin's `Death Cross' Looms as Strategist Eyes $2,800 Level
 

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Comments (28)
Rami Abdulaziz
Rami Abdulaziz Mar 19, 2018 12:58AM ET
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same news, looking like you want it dawn :)
sweet boy
sweet boy Mar 18, 2018 5:10PM ET
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Thanks
emanuel sousa
emanuel sousa Mar 18, 2018 11:13AM ET
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Same news lol
alex deez
alex deez Mar 18, 2018 5:38AM ET
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over posting..wall street afraid
matthew cahalan
matthew cahalan Mar 18, 2018 2:51AM ET
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How many times is this same article going to be pinned to the top of the crypto news feed!!??
Donald Hancock
Donald Hancock Mar 17, 2018 4:32PM ET
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I would welcome a drop to $2800 or even lower. IMO there was way too much hype and people piling in due to FOMO and just trying to make a quick buck. Now, I am not saying I didn't take advantage of the crazy price action last year because I did. But what I think will happen is that cryptos will keep dropping, maybe to around $6000 to re-test the low set in Feb. or maybe even lower, $4000, $2000, whatever. At some point, they will find a bottom and consolidate, all those just looking for a quick buck who thought it was going to go to $100,000 in a year will get bored and leave. Then the "smart money" will come in and start buying, start accumulating for the next bull market. Right now I hold very little crypto compared to last year, other than an occasional trade I am willing to wait and then start slowly buying back in.
matthew cahalan
matthew cahalan Mar 17, 2018 3:39PM ET
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This story keeps getting renewed on the feed to overshadow anything positive. Crypto is growing faster than governments can control. Bad for them good for us. Total FUD
Max Rochester
Max Rochester Mar 17, 2018 3:03PM ET
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i hope it drops back to 700 lol
Rararr Chao
Rararr Chao Mar 17, 2018 3:03PM ET
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Smh poor kid, and but even if it does you still won't buy because of fear
كريستوفر أورورك
كريستوفر أورورك Mar 17, 2018 2:38PM ET
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Do not be fooled every market will always go up and down but you are all crazy if you don't think that the creator of bitcoin is another perfect strategy the world elites made to shock wave the economys of the world to find out where most of the population stood with the idea of a world digital currency and as an all out general census of who got what and how much to gamble. Then they do what they always do turn the prices up where people were not struggling and centralize the
Omid Navid
Omid Navid Mar 17, 2018 12:50PM ET
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Bitcoin is not much of a technical asset It has never been
Omar Zaghloul
Zaghloul Mar 17, 2018 12:50PM ET
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its not an asset. its not anything, and its inherently worthless.
 
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