As BTC fell below $43,500, the bearish Bitcoin fractal with a success rate of 78% flickered

Last week’s reduce In Bitcoin (Bitcoin) The drop in the price of BTC from US$47,358 to US$43,178 raised concerns about long-term selling.

Independent market analyst Nunya Bizniz highlight A bearish fractal on Bitcoin’s weekly chart regarding its 21-week exponential moving average (EMA).

In detail, the cryptocurrency has so far closed below the above-mentioned support zone 18 times, but only 4 of them have retained the previous bullish bias-as shown by the vertical dashed line in the figure below.

BTC/USD daily price chart, showing its 21-week EMA. Source: Nunya Bizniz,

In the remaining cases, closing prices below the 21-week EMA resulted in extremely low Bitcoin prices, unless there was a false bearish breakout in August 2015, which soon resulted in a “huge bull market”, as analysts pointed out.

Similarly, Bitcoin recently broke the wave in May 2021, which also caused the price to fall below $30,000 for the first time since January 2021.However, this crossover did not lead to Full-scale bearish collapse; Traders bought on dips near 30,000 USD and brought the price back to above 50,000 USD.

But overall, the phenomenon of Bitcoin prices falling below the 21-week moving average has led to a long-term sell-off of nearly 78%.

Bitcoin once again fell below the 21-week moving average

Bitcoin closed at $43,178 in the week ending September 26, reminding it of its 19th historical decline below the 21-week moving average-weekly closing price of approximately $43,502.

Although the fractal anticipates the downside results, a closer look at the relationship between the 21-week EMA and the 50-week simple moving average (SMA)-as shown in the chart below-notices that the potential bearish outlook needs further verification.

This is mainly due to the direct reaction of traders to the two moving averages, especially when the 20-week EMA (green wave) closes below the 50-week SMA (blue wave).So-called Death cross This indicator previously coincided with a further decline in the Bitcoin market.

The weekly Bitcoin price chart shows a 20-50-MA death cross. Source:

For example, in the week ending January 29, 2018, the BTC/USD exchange rate fell below its 21-week moving average (approximately US$8,041), but maintained an upward trend until the green wave closed below the blue wave. Later, the currency pair bottomed near its 200-week moving average (close to $3,187).

Similarly, the 20-50 MA death crossover in March 2020 is only The notorious Covid-19 sell-off, The global market crash led by Covid-19. Similarly, Bitcoin finally closed near its 200-week moving average (approximately $5,512), and then rebounded to a new record high in a few trading days.

related: The CEO of JPMorgan Chase said that the price of Bitcoin may rise 10 times but still will not buy

Therefore, Bitcoin’s potential death cross between its 20-week moving average and its 50-week moving average seems likely to trigger the next selling crisis, with the final downside target located near the 200-week moving average (approximately $16,000).

At the same time, the Fibonacci retracement levels close to US$34,712 and US$27,580 may prevent Bitcoin prices from approaching the 200-week moving average.

The views and opinions expressed here only represent the views of the author and do not necessarily reflect the views of Every investment and trading action involves risk, and you should conduct your own research when making a decision.