In First Since 2015, Bitcoin’s Price Is Testing a 200-Week Average

Omkar Godbole
Nov 21, 2018 at 15:15 UTC
markets

The pace of bitcoin’s ongoing sell-off is setting new records with every passing day, the latest being its test of a key long-term moving average for the first time in three years.

Indeed, the world’s most valuable cryptocurrency network fell below its 200-week exponential moving average (EMA) of $4,180 yesterday, marking the first break of the crucial support since August 2015. Back then, BTC was changing hands around $220, according to Bitstamp data.

The breach of long-term support, however, was short-lived as record low readings on the relative strength index (RSI) likely put a bid under BTC, helping it regain some poise.

At press time, BTC is changing hands at $4,440, having clocked a 14-month low of $4,048 yesterday.

Notably, the recovery has established the 200-week EMA as the level to watch out for in the near-term. The already bearish technical setup would be bolstered further if the cryptocurrency finds acceptance below the long-term EMA support, leading to a deeper drop below the psychological support of $3,000.

Weekly chart

As can be seen above, the 78.6 percent Fibonacci retracement of the rally from 2015 lows to 2017 highs lines up at $4,328 – just above the 200-week EMA of $4,180. So, it seems safe to say that the area between $4,100 and $4,350 is packed with key support lines.

The chart also shows that a break below the 200-week EMA could prove costly as the next major support is seen directly at $3,130 – the widely followed 200-week simple moving average.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

image via Shutterstock; Charts by Trading View

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This article is intended as a news item to inform our readers of various events and developments that affect, or that might in the future affect, the value of the cryptocurrency described above. The information contained herein is not intended to provide, and it does not provide, sufficient information to form the basis for an investment decision, and you should not rely on this information for that purpose. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.