Cryptocurrency is heading for the ‘cross of death’
The world’s largest cryptocurrency bitcoin is plunging towards a ‘death cross’ – a technical pattern that could lead to another major sell off of the coin – a prominent crypto trader has warned.
Cryptocurrency trader and analyst Rekt Capital, who is followed by more than 150,000 people on Twitter, said the potentially catastrophic event for large crypto investors could occur by the middle of this month if bitcoin was not increasing its price soon.
Once the “death cross” is reached, they said the digital coin could drop to as low as US $ 18,000 (A $ 23,500). The coin is currently worth US $ 38,879 (A $ 50,749), which means its value could be cut by more than half.
According to Rekt, a death cross occurs when the short-term moving average falls and falls below the long-term moving average. The opposite motif is known as the “golden cross”.
The analyst said there had been similar “death cross” patterns in the market in previous years, which saw cryptos plummet dramatically.
In 2013, bitcoin lost 73% crosses before death and 70% more crosses after death.
In 2017, they said he lost 70 percent of crosses before death and an additional 65 percent after death.
While in 2019, they said it fell 53% before death and a further 55% after death.
Since then, bitcoin has fallen 54% from its highs of around $ 65,000 (A $ 85,000) and Rekt believes it could lose an additional 55% in the event of another deadly cross.
However, they said it was not inevitable.
“This has not happened and should not happen if BTC recovers,” they said.
How did the market behave overnight?
The value of big players like Bitcoin and Ethereum continued to rebound after last month’s crisis overnight.
According to CoinDesk, bitcoin has jumped 3.67% in the past 24 hours, while ethereum is up 5.35%.
There was a lot of attention on dogecoin yesterday, after the coin itself rose 21% – its highest level in about two weeks, according to CoinDesk.
The surge came after it was added to Coinbase Global – a platform for more experienced investors.
This means that the digital coin, which was originally designed for no use, now has a market value of around $ 53 billion (A $ 63 billion). Still, it’s lost almost half of its value from its May peak.
And according to CoinDesk, it has fallen 4.12% in the past 24 hours.
The debut on Coinbase Pro means that users of the very popular cryptocurrency exchange can now trade dogecoins for the first time by signing up to its free business platform.
Dogecoin was also likely boosted by Tesla CEO Elon Musk, who has amassed huge clout in the crypto market.
After Coinbase said it would support dogecoin trading, Mr. Musk shared a July 2020 meme showing the cryptocurrency subsuming the global financial system, with the comment: “It’s inevitable.”
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He also suggested that he plans to adopt a shiba inu – the Japanese dog breed that inspired the doge meme and dogecoin – later this year.
Cryptocurrencies such as bitcoin and dogecoin have already seen large swings in their prices following comments from the tech billionaire. His tweets have also previously been linked to movements in the stock market in so-called memes stocks such as GameStop.
In February, the value of dogecoin, which started out as a dog-based internet meme, soared 50% when Musk described it as “the people’s crypto.”
Last month, when hosting Saturday Night Live, Musk said the dogecoin was a “stir,” causing its value to drop again.
The price of bitcoin climbed 14% to an all-time high of $ 43,500 (56,700 A) earlier this year after Musk praised it on Twitter. He then bought $ 1.5 billion (AU $ 1.96 billion) in digital currency and said Tesla would allow customers to pay with it.
But then, a turnaround last month saw bitcoin retreat 17% after the electric car maker suspended bitcoin payments. Musk said he was concerned about the fossil fuel intensity of bitcoin “mining”.