Bitcoin Price is Haunted with ‘Death Cross’ over the Weekend: A Doom in Cryptocurrency

Being the world's most popular cryptocurrency, Bitcoin triggered a 'Death Cross' that indicated more downfall in the cryptocurrency price in the future. The Bitcoin stocks were sold off by 14% on Monday morning after the doom on the weekend. The price of Bitcoin was US$32,715.28 with a decrease in market cap to US$613.03 billion. The lowest value of the 24-hour trading was US$31,744.99 while the highest touched US$36,119.80. The Death Cross indicates that Bitcoin prices will continue to fall in the nearby future.  It is well-known that the cryptocurrency market is highly volatile in nature. This is the second time for Bitcoin to experience Death Cross since March 2020.

What is a Death Cross in Cryptocurrency?

A Death Cross is a technical chart pattern, used to explain when a short-term 50-day moving average trendline crosses below a long-term 200-day average trendline. It shows the change in cryptocurrency price momentum to the investors.  It provides a signal that the buying momentum is coming out of stock, market or cryptocurrency when there is a huge gap between the averages. The long-term moving average provides a robust trend and huge demand in the cryptocurrency market. The short-term moving average describes that there is no demand and interest which lead to the huge price drop in the market. If there is any negative convergence, it can lead to severe selling pressure. This pressure can keep the cryptocurrency price stay to lower for one month or a year.

It is anticipated, that the recent Death Cross happened due to the major hashing of Bitcoin by China. China's major crypto-mining hub in Sichuan province received an inspection letter for shutdowns. China announced that it summoned officials to reiterate a ban on cryptocurrency services. It showed that China can plan whatever it takes to close loopholes left in the cryptocurrency market.