Bitcoin (BTC) has been under selling pressure lately on the back of weak tech stocks and rising bond yields. Some analysts are looking to key Bitcoin price averages for clues as to crypto’s next move.
Bitcoin, the top cryptocurrency by market capitalization, was at $27,400 at the time of writing, down 11% from its 10-month high of $31,000 on April 14, according to CoinDesk data. bottom. The drop has brought Bitcoin’s 50-day Simple Moving Average (SMA) to the fore. It currently sits at $27,244.
FxPro Senior Market Analyst Alex Kuptsikevich said a break below the 50-day SMA support would challenge bullish market sentiment.
“The market has erased previous growth momentum and is now testing the strength of the medium-term uptrend in the form of a 50-day moving average,” Kapzykevich said in an email. “A drop below this would put a question mark on the bull market, and a break below $26,600 could be the prelude to a more serious downturn.”
The 50-day SMA is one of the most widely tracked technical lines in both traditional markets and crypto. Crypto analysts have long identified bullish and bearish trend shifts above or below this important average.
Bitcoin did not break through the 50-day SMA on April 24. If it falls below $25,200, which was the upper limit of the rise from August 2022 to February 2023, the next support line (support line) can be seen from the weekly chart above. may become.
Katie Stockton, founder and managing partner of Fairlead Strategies, says the SMA’s support line is fragile and could soon pave the way for a deep decline. .
“Bitcoin is testing the 50-day SMA, which is a short-term oversold that will cause a brief pause before Bitcoin resumes its decline towards the key support line ($25,200). Let’s see,” Stockton said in a memo sent to clients late Wednesday.
An oversold condition is one in which the price drops significantly and consistently over a specified period of time with little pullback. Technical analysts use indicators such as the Relative Strength Index and Stochastic to determine overbought and oversold conditions on various timeframe charts (daily, weekly, hourly).
That said, if the 50-day SMA remains strong, a fresh rally could resume in line with the broader bullish outlook.
“The recent breakout (moving above $25,200 in March) and positive weekly MACD support a bullish mid-term bias, with the next major resistance at 3 It could be around $5,900,” Stockton said.
｜Translation: coindesk JAPAN
｜Editing: Toshihiko Inoue
| Original: Bitcoin’s 50-Day Moving Average in Focus for Crypto Analysts After 11% Price Pullback