An analyst has explained how Bitcoin is forming both a death cross and TD sell signal, which may lead to potential dips in these targets.
Once the setup is complete, the countdown phase begins. This phase works much like the setup, except that candles are counted up to thirteen instead of nine. After the countdown’s completion, the commodity may be assumed to have reached another potential top/bottom.
Now, here is the chart shared by Ali that highlights how signals about both of these technical analysis patterns have been witnessed in the 12-hour price of Bitcoin recently:
Bitcoin Looking In Trouble As 12-Hour Chart Forms Two Bearish Signals
In a new on X, analyst Ali discussed two signals that have recently formed in Bitcoin’s 12-hour chart. The first of these is a “death cross,” which occurs when an asset’s short-term simple moving average (SMA) dips below its long-term SMA. Regarding the death cross, the 50-day and 100-day SMAs make up for the short-term and long-term trend lines. Historically, such formations have been considered bearish signals, with the price potentially suffering once the pattern is confirmed.
The other signal that has appeared for the cryptocurrency involves the Tom Demark (TD) Sequential. This indicator is popularly used for finding locations of probable tops and bottoms in any asset’s price.
The TD Sequential has two phases: the “setup” and “countdown.” The first phase, the setup, is said to be complete once the asset has gone through nine candles of the same polarity. After these nine candles, the price may have reached a likely reversal point. Naturally, if the candles in the setup’s formation were red, then the signal would be a buy one, while if the prevailing trend were bullish, the reversal would be towards the downside.
The two signals that the 12-hour BTC price has formed in recent days | Source:As is visible in the graph, the 12-hour price of Bitcoin first saw a death cross form with the 50-day SMA moving under the 100-day SMA. Then, it observed the completion of a TD Sequential setup, with the indicator suggesting a reversal to the downward direction.
Since this double bearish pattern has appeared, BTC has been heading down, suggesting that these signals may already be in effect. “If BTC falls below $63,300, brace for possible dives to $61,000 or even $59,000,” says the analyst.
From the current price of the cryptocurrency, a potential drawdown to the first of these targets would mean a decline of 4.6%, while one to the latter level would suggest a drop of nearly 8%.
BTC Price
So far, Bitcoin has managed to prevent falls under the $63,300 target listed by the analyst, as it currently floats around $64,000.Looks like the price of the coin has lost its earlier recovery during the past 24 hours | Source:
Featured image from Shutterstock, charts from TradingView.com
