Bitcoin price treaded on shaky ground on Saturday, following rollercoaster movements earlier in the week, which saw the largest cryptocurrency briefly drop below $50,000 before jumping 28%. However, a death cross pattern casts doubt on the continuation of the uptrend while increasing downside risk.
Assessing Bitcoin Price Looming Correction
Bitcoin price surged to $62,760 on Thursday, recouping all the losses from Monday’s black swan event. The drastic drop coincided with a sell-off in the stock market caused by lower-than-expected US nonfarm payroll data, hinting at a possible recession in the US. Besides, the Federal Reserve’s dovish stance on interest rate cuts brought about a precarious situation, with risk assets like Bitcoin and stocks facing the heat.
Meanwhile, BTC price faces increasing sell-side pressure ahead of a looming death cross. A death cross occurs when a short-term moving average crosses below a long-term one, hinting at potential bearishness.
Looking at the daily chart, the 50-day Exponential Moving Average (EMA) is at $62,660 while falling toward the 200-day EMA at $59,464. A crossover will confirm the death cross and compel traders to consider shorting BTC or tightening stop-loss orders. Confirmation with other indicators is crucial because only five of the previous patterns led to extended downtrends.
Bitcoin’s short-term whale-holding patterns could further challenge the uptrend between $64,000 and $64,000, an area representing their respective realized prices. Failure to break above this level would drive bulls to the edge, increasing the chances of the death cross pattern validating a sell-off to the $52,000 and $49,000 support levels.
Persistent negative Bitcoin ETF flows to validate the bearish picture. According to SoSoValue, a total of $89.73 million was withdrawn on Friday, bringing the cumulative inflow volume to $17.34 billion.
Continued BTC ETF inflows are essential for maintaining the current uptrend. Historical data shows a strong correlation between positive ETF flows and Bitcoin price performance, as evidenced by the Q1 2024 rally to $73,737.
BTC Price Bullish Levels To Watch
The above bearish outlook may fail to hold should whales continue accumulating at the current price, using $60,000 as key support. Increasing demand would strengthen Bitcoin price, which may seamlessly flip the $62,000 – $64,000 range into support, paving the way for gains toward $70,000.
The Moving Average Convergence Divergence (MACD) on the daily chart depicts signs of an upcoming buy signal. This call to bet on Bitcoin price rallying higher occurs when the blue MACD line crosses above the red signal line. If demand increases, a stronger tailwind would drive BTC price to tag the coveted $70,000 level.
The post Here’s How Bitcoin Price Could Overcome Death Cross? appeared first on CoinGape.
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