Charts show the Bitcoin price seems to be falling below the 600-day moving average, a sign that could be bearish for the crypto.
Bitcoin Begins To Lose 600-Day MA Support Line As Price Crashes Below $39k Again
As pointed out by an analyst in a CryptoQuant post, the price of the crypto is crossing below the 600-day MA curve now, a line that has served as support for BTC in the past.
A “moving average” (or MA in short) is an analytical tool that takes the average of any quantity over a particular time period. As the name already suggests, this average constantly updates itself as time passes and new values arrive.
What this tool does is that it removes any short-term fluctuations from the chart being studied (which is the Bitcoin price in this context), and smooths out the curve.
This makes moving averages quite useful for studying long-term trends, where local variations aren’t that important.
Related Reading | Is Bitcoin Gonna See Another Big Drop Soon? Historical Trend May Say Yes
MAs can be taken over any possible range, whether that be two days, two hundred days, or even only two minutes.
Now, here is a chart that shows the trend in the 600-day MA version of the Bitcoin price:
Looks like the price curve is dipping below the 600-day MA line now | Source: CryptoQuant
As you can see in the above graph, the Bitcoin 600-day MA curve has acted as support for the coin’s price many times in the year so far already.
However, the latest trend seems to suggest that this support line is now breaking down as the price line is crossing below the MA on the daily timeframe.
Related Reading | Time Vs Price: Why This Bitcoin Correction Was The Most Painful Yet
Though, the breakdown may not be yet fully confirmed. The quant in the post believes that if the breakdown fails here, Bitcoin may then use the level as a springboard to push higher.
In the case that the breakdown does stand, then a bearish outcome may perhaps be in store for the cryptocurrency.
BTC Price
At the time of writing, Bitcoin’s price floats around $38.8k, down 1% in the last seven days. Over the past month, the crypto has lost 12% in value.
The below chart shows the trend in the price of the coin over the last five days.
Looks like the price of the coin has plunged down over the last few days | Source: BTCUSD on TradingView
Bitcoin briefly seemed to have been on the path of recovery just a few days back as the coin broke above the $42k mark.
However, the cryptocurrency now seems to have plummeted down again as it once more revisits the sub-39k levels.
Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com
Credit: Source link
