AlanSantana

What About The Death Cross? Bitcoin Death Cross Signal Explained

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
This is literally the question most often asked in the comments section when I share any bullish article on Bitcoin ... But what about the death cross?

A death cross happens when MA50 crosses bearish the MA100 line, here marked as Blue and Red respectively:
The death cross is a bearish signal.

When we do chart analysis, we do not take signals independently but instead we look for multiple signals to support our bias.
Meaning, one signal alone isn't good enough to call for a jump or drop in prices.

With that said, all signals have their meaning/value.

Some signals can be weak while others can be strong...
Having multiple signals pointing in the same direction can give you a better idea as to what is happening with any pair/asset and what might happen in the days to come (we are looking at the daily timeframe ).


Back to the Bitcoin Daily (D) Timeframe Death Cross

Prices tend to gravitate towards the MA lines.

As you see MA50 and MA100 curving down, prices tend to gravitate towards these and move up...
The death cross as it shows up here is a "mid to long-term" signal.

Meaning that prices can bounce (move up) before going lower... It all depends on where the cross shows up and its strength.

The charts are always changing... Let me show you an example of a failed death cross:


Here we have the price "bounce" before lower prices...
We are likely to see something similar with the recent death cross we are experiencing since it showed up after a new All-Time High.

If the cross shows up after hitting support or a new low, then the results might be different...

Were you entertained?

Thank you for reading.
Thanks a lot for your continued support.

Namaste.
Comment: The way we read this signal from our TA perspective is the same if use MA50/MA100 or MA50/MA200.

EMAs can also be used to reach the same conclusions as described above.

Bearish cross (Death cross) of MA50 vs MA200
Comment: 2014 Death cross
Prices first bounced followed by lower prices...

2018 Death cross
Prices first bounced followed by lower prices...

2021 Death cross
Prices first bounced followed by lower prices...
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