FameEX Hot Topics | Bitcoin ‘Death Crosses’ Or Pile Up To Spark $92K Price Test

Bitcoin may be on the verge of a correction, as technical charts and market indicators suggest a possible downturn. Material Indicators reports that multiple daily moving averages signal lower price levels for BTC. Their February 17 analysis indicates that BTC/USD could soon break out of its current tight trading range in a downward direction.

In particular, Material Indicators highlighted the appearance of “death crosses” on the Bitcoin chart. A death cross occurs when a shorter-term moving average crosses below a longer-term one, signaling weakening momentum and raising the likelihood of a prolonged downtrend. Despite this bearish pattern, the analysts noted that increasing bid liquidity in the order book could help limit volatility. Their FireCharts data identified local support at $95,000 and secondary support at $92,000, suggesting a dip to these levels might validate market support and provide buying opportunities for long-term holders.

Keith Alan, co-founder of Material Indicators, described the anticipated dip as a “shakeout” rather than a cause for alarm. “I do not fear this dip,” he told his followers. “In fact, I welcome it and I’m looking to add to my longer-term position.” This approach underscores the importance of patience and sticking to a predetermined trading plan, even as market participants reduce BTC exposure.

Meanwhile, trading volumes have been declining, compounded by the President’s Day holiday in the U.S., which kept Wall Street closed and left institutional involvement minimal. Trading firm QCP Capital noted that implied volatility has steadily decreased, with seven-day realized volatility dipping to 36%. In the absence of significant cryptocurrency-specific catalysts, Bitcoin’s price action appears more influenced by macroeconomic factors. The correlation between Bitcoin and equities remains intact, and rising inflation pressures continue to weigh on risk-asset traders.

Despite these challenges, Bitcoin has remained relatively stable in the face of recent macro data, according to QCP Capital. The firm observed that open interest in crypto options markets is low, reflecting a wait-and-see approach. Rather than responding to pro-crypto sentiment alone, the market seems to be holding out for concrete policy changes before committing to major moves.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.