 ▲ Bitcoin (BTC) plunge / ChatGPT-generated image © |
A devastating bearish signal that has appeared during every past cryptocurrency downturn has resurfaced, raising fears of a massive crash that could slash leading cryptocurrency Bitcoin (BTC) to as low as $36,000.
According to cryptocurrency media outlet Finbold on March 7 (local time), TradingView analyst TradingShot warned of the possibility of a large-scale correction, noting that a Bitcoin dead cross has formed on the three-day chart. A dead cross occurs when the 50-period moving average falls below the 200-period moving average and is regarded as a classic bearish signal that has historically appeared just before prolonged downturns in the crypto market.
Historical data shows that whenever this pattern emerged during bear market phases since 2014, Bitcoin plunged sharply after the crossover. During the 2018 “crypto winter” and the 2022 downturn, Bitcoin fell about 52% following the signal, while the 2014 cycle saw a drop of 57%. Analysts estimate that if a similar 52% decline occurs this time, the price could retreat to around $36,000, identifying the $40,000 to $36,000 range—aligned with Fibonacci extension levels—as a potential accumulation zone.
This pessimistic outlook comes as a shock, as it follows Bitcoin’s surge to around $74,000 between March 4 and 5, marking its highest level in a month. The rally was fueled by a short squeeze (buying driven by the liquidation or covering of short positions), renewed inflows into spot Bitcoin ETFs, and resilience amid escalating geopolitical tensions in the Middle East. Notably, Bitcoin climbed in tandem with a strong U.S. dollar but lost momentum within days, surrendering most of its weekly gains.
Bitcoin is currently trading at $67,955, well below its 50-day simple moving average of $75,548 and its 200-day simple moving average of $96,080. Trading beneath both moving averages is a typical bear market condition, indicating that the overall market trend remains under strong downward pressure. However, the 14-day Relative Strength Index (RSI), which measures the speed and magnitude of price movements, stands at 45.93, remaining in neutral territory and presenting mixed signals.
According to CoinMarketCap, Bitcoin was trading at around $68,180 at the time of writing.
*Disclaimer: This article is for investment reference purposes only and we are not responsible for any investment losses incurred based on this information. The content should be interpreted solely for informational purposes.*