- Bitcoin drops from its 10-month high of $31,000 to $27,400 over the week.
- Analysts focus on the 50-day SMA as a key indicator to predict critical bearish signals.
- Technical analysts also use RSI to gauge a $25,200 retest.
Bitcoin has fallen from its 10-month high to $27,400. This pullback has some analysts focusing on a key Bitcoin price average, the 50-day simple moving average (SMA), to predict a potential bearish signal.
In an interview, Alex Kuptsikevich, senior market analyst at FxPro, argued that a break below the 50-day SMA would challenge the bull market’s strength, adding that a consolidation below $26,600 could be the prologue to a more profound decline. In his words:
The market has erased its previous growth momentum and is now testing the strength of the medium-term uptrend in the form of the 50-day moving average. A break below this would call into question the bull market’s strength.
Katie Stockton, the managing partner at Fairlead Strategies, also weighed in on the conversation, stating that the SMA support could be short-lived and may lead to a more substantial decline.
“Bitcoin is testing the 50-day SMA,” Stockton said, adding that “a minor level where short-term oversold conditions should generate a brief pause before resuming lower toward key support of approximately $25,200.”
Notably, some crypto traders on Twitter have also shared the views of Kuptsikevich and Stockton, using different technical indicators such as the Relative Strength Index (RSI), a measure of overbought and oversold conditions.
A crypto analyst with Twitter username Stockmoney Lizards believes Bitcoin’s price movement will either find good support at the current $27,000 or fall further and retest the $25,000 neckline.
#Bitcoin Two short term scenarios (4h Chart). Right now, 27k looks like a good support. If broken, we will likely get that 25k neckline retest! pic.twitter.com/uM8XxfZvWY— Stockmoney Lizards (@StockmoneyL) April 25, 2023
At press time, Bitcoin trades at $27,323, losing over 9% over the previous week, according to CoinMarketCap.
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