The response to this latest cross, however, has been vigorously robust with a strong fightback from yesterday’s plummet to $6,500 back up to $7,200. A death cross is a pattern on most financial charts that happens when the short-term moving average of a particular stock crosses below the line of the long-term moving average. Nine times out of ten, in almost any market, it sounds a warning klaxon to traders that the market is on the brink of a massive correction. While this is only the third time in recent cycles that a death cross has appeared on the bitcoin charts, it has come perilously close to it on several occasions – although each one was beaten back with strong resistance.
That response is beginning to show a little in the current fight to maintain BTC’s value and, while the push back up over $7,000 is admirable, it still looks like too little prevent the inevitability that a death cross invariably brings.
Bitcoin was unable to successfully repel a downward push on two traditional lines of resistance – $7,800 and $7,300 – last week, leaving things looking decidedly weak.
Without a meaningful drive upwards and a sustained period above either of those two figures, the legacy of ten years’ worth of charts tells us with almost 90% certainty that the market will correct to a yearly low – possibly slipping below $6,000 as November blends into December.
As always with BTC, the small print says “expect the unexpected”, and while there’s even a hopeful 10 percent glimmer of a serious comeback then the possibility is always there.
Either way, volatility has certainly returned to the market.