Make a cross on the recovery? Bitcoin (BTC) is back below $30,000. Traders are trying to identify the next stops, should ours manage to put additional strong downside pressures.
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Bitcoin post-death cross: the $22,700, a must?
The price of bitcoin rises above $30,760 on Bitfinex today, May 20, 2022. It subsequently loses $30,000. Bitcoin trades at $29,231 at the time of writing this article. It is currently recording a daily loss of 3.38%.
While the day is bearish, traders are interested to any additional reductions what bitcoins could suffer.
For trader Michaël van de Poppe, $29,300 remains at a crucial level. If bitcoin manages to hold above this level, “I will see a continuation in the markets.” Otherwise, bitcoin could $26,000 dropper.
The trader Rekt Capital has published a series of several tweets, to analyze the Possible bearish scenarios post-death crossin order to predict the price floors possibly above those recently affected.
The death cross is when the 50-period moving average falls below the 200-period moving average. It was in the past at the origin of the sharp declines. To predict the dips after such a bearish crossover, Rekt Capital indicates that:
“Most often, the depth of a pre-Death Cross $BTC correction is similar to the depth of the post-Death Cross retracement.”
However, this rule was not followed in March 2020 and May 2021. The death cross was during these periods, the very bottom of the decline.
In 2022, a death cross took place in January, when bitcoin had already recorded by then a decrease of 43% from its all-time high at $69,000.
Based on previous theory, a 43% drop post-death cross would locate the lows of the degraded decline since January 2022, at $22,700.
Bitcoin’s next target levels are looking increasingly clear for bitcoin. If the bulls smoke the edge then bitcoin would have the $33,000 in sight. If not, post-death cross theories seem to argue for a drop to around $22,000, and if extended to $20,000 under water.
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