Crypto-currency analyst Benjamin Cowen recently highlighted an important technical pattern on the weekly chart of bitcoin, known as the “death cross“.
This pattern occurs when a shorter-term moving average, such as the 50th week, crosses below a longer-term moving average, such as the 200th week. In financial terms, this is a bearish signal that suggests a potential reversal and a prolonged downtrend.
The death crossover is often considered a sign of bearish market sentiment and can lead to a significant drop in price. It is a warning for traders to be cautious and for long-term investors to consider selling their holdings.
– Benjamin Cowen (@intocryptoverse) February 13, 2023
This pattern may also indicate a change in market sentiment from bullish to bearish and may result in an extended period of price consolidation.
Despite the recovery that began in January, bitcoin was unable to enter a prolonged uptrend and quickly reversed two days ago, returning to the $21,000 price level and consolidating at the 200-day moving average. This could be a sign of a larger trend reversal for the leading crypto-currency.
However, it is important to note that the death cross is just one of many technical indicators used by traders and analysts to make informed decisions. While it can be a valuable tool for understanding market sentiment, it is not a guarantee of future market performance.
As of press time, bitcoin is trading at $21,827 and has recently gained 1.6% of its value over the past 24 hours, successfully rebounding from the local low of $21,476. Unfortunately, the golden crossover that traders were expecting on the asset’s daily chart did not occur.