- A lack of positive developments in the crypto and blockchain space has led to fading sentiment and further declines in bitcoin's price.
- A long-term bear crossover of the 100 and 200-day moving averages (MAs) confirms BTC's latest leg down.
- BTC looks set to test the 100-period moving average on the weekly chart, now located at $7,520.
Bitcoin prices tumbled over 4 percent Monday as buyers proved reluctant to engage with the market, likely due to recent suggestions of a new crypto crackdown in China.
At press time on Tuesday, the world’s top crypto by market capitalization had dropped further, and was down 3.03 percent on the day. Bitcoin is currently changing hands at $8,144, according to CoinDesk’s Bitcoin Price Index.
Amid the lack of trader enthusiasm, two long-term moving averages – the 100 and 200-day – crossed over on Nov. 17, suggesting a long-term trend change in favor of the bears.
As seen above, a crossover of the two averages, whereby the 100-period moves below the 200-period, does not bode well for bitcoin’s price. Back in early 2018, a long-term bear cross saw prices fall by as much as 60 percent.
While past events are not indicative of future results, it does raise the question: how far can bitcoin’s value fall?
Further losses will expose prices to the 100-period moving average on the weekly chart, now located at $7,520.
With a lack of bullish fundamentals, bitcoin is deflating under seller pressure, as reflected in the daily and weekly RSI’s (not shown) which are in bearish territory beneath the neutral 50.00 line.
Selling volume has also risen to its highest in three days, adding to the credence of the downside move.
The bulls need to enter back into the fray in force if they hope to stem the bleeding, and need a firm close above $9,000 to reverse the current trend. For now, that seems a tall order.
Disclosure: The author holds no cryptocurrency assets at the time of writing.