- Bitcoin has traded below the 200-day moving average for over a week
- The moving average is now a resistance zone for Bitcoin around the $40k price level
- Bitcoin is also trading below the 6-month moving average
- BTC’s bullishness is hinged on reclaiming these two MAs otherwise a bear market will ensue
Bitcoin might have entered a bear market based on the fact that the King of Crypto has failed to reclaim the 200-day moving average as support. At the time of writing, Bitcoin has traded below this important moving average for eleven days. The 200-day MA is currently at the $40k price level that is also acting as a strong resistance level for Bitcoin.
Bitcoin Consolidating Below the 200-Day MA is Not a Good Sign
In a Twitter commentary earlier this week, Bitcoin and crypto analyst, MagicPoopCannon, pointed out that BTC consolidating below the 200-day moving average was ‘not a good sign’. He also reiterated that this moving average is now a resistance area and Bitcoin has never regained its bullish momentum if it traded over 3 days below this line. He explained:
Not to rain on the bull parade, but BTC has now spent seven [currently 11] days below the 200 MA. Never in the history of BTC, has it spent more than 3 days below the 200, and gone on to make new all time highs, and that only happened in 2013. We’re most likely in a bear market.
Bitcoin is Also Trading Below the 6 Month MA Which is Bearish
In a follow-up to his initial analysis, Magic also pointed out that Bitcoin was also trading below the crucial 6-month moving average. He also warned that a monthly close this month, below this moving average, will confirm that Bitcoin is indeed in a bear market.
BTC has confirmed the 200 day moving average (in purple) as initial resistance, and it may close the month below the 6 month moving average (in orange.) Neither of those things have ever happened in a bull market, which makes it very likely we’re in a bear market now.