⚠️Bitcoin's significant technical signal is flashing red: the 50-week moving average has been breached, is $38,000 coming?
The recent trend of Bitcoin can be said to have tightened the hearts of the entire market. Just when everyone thought BTC would stabilize, a key technical indicator suddenly 'broke down'—Bitcoin's price has for the first time in this cycle fallen below the 50-week moving average (MA).#BTC
This is not just an ordinary small signal, but a 'super warning light' that has triggered bear markets multiple times. Many veteran players are already starting to get anxious.
💥Why is it so terrifying to break below the 50-week moving average?
Cryptocurrency analyst Tony Severino recently posted a critical technical analysis on X. He pointed out:
In the past 14 years of Bitcoin history, every time the closing price falls below the 50-week moving average, it will usher in a sustained decline.
Does this sound a bit scary? Let's take a look at the historical records:
Last time it broke → subsequent drop of 61%.
The time before last → drop of 59%.
Even earlier → drop of 67%.
On average - Bitcoin continues to fall about 62% each time it breaks below.
What does this mean? If applied to the current price structure, the scenario of 'dropping 30,000 to 40,000 dollars' is no longer sensational but indeed has historical data support.
Technical momentum is also flashing a warning: LMACD is approaching a four-year low.
The price is not one person 'crying'; the momentum indicators are also starting to synchronize 'weakness'.
Severino's second analysis looks at the daily level LMACD indicator. This is a tool used to judge the strength of market momentum, and right now it is:
It has approached the lowest point in nearly 1250 days.
Since the peak of the bull market in 2017.
There have only been 6 times that it has dropped to this level.
And during those 6 times, Bitcoin had not really bottomed out.
In other words, while the current market looks like it has dropped severely, from a momentum perspective:
It may not have 'finished falling'. A real major correction may still be on the way.
It's like the car has started to brake, but you feel through your foot that - the brake pads don't seem strong enough, and it still needs to grind for a while.
🤔 Why is this time particularly critical?
The chart provided by Tony shows that Bitcoin's long-term trend has slid towards the lower boundary range. But the key point is: the current momentum is not weak enough to reach the 'extremely pessimistic' true bottom area.
In other words, the current level of market panic is not high enough; bottoms usually occur when there is 'despair across the network', and the current panic index? Not yet reached.
What does this situation resemble? It's like a storm is coming, but the real gale hasn't started yet.
📊 Current market situation: Highly volatile, prices are still dropping.
According to CoinMarketCap data:
Bitcoin is currently trading below $87,000.
In the last month, it has dropped by 24%.
The entire market is very volatile.
You read that right - a 24% drop is already a 'doomsday scenario' in the stock market, but in the crypto world, everyone has been trained to take it as routine.
🔍 So what's next? Will it really reach $38,000?
To be honest, this number is not baseless.
If we refer to the historical average drop of 62%, combined with the current weak performance of momentum, plus the impact of macro uncertainties, $38,000 is indeed within a very reasonable expectation range.
Of course, this is not a hard and fast rule. But at least it tells us - the market has not escaped the danger zone.
🧭 Written at the end: Should we panic now or be optimistic?
If you are a short-term player, now is indeed a time to be vigilant; if you are a long-term holder, you might take this as a 'bottoming period' or even a great opportunity for the future.
But no matter what kind of player you are, one fact remains:
Bitcoin has never changed its nature of 'violent fluctuations', and every major fluctuation gives birth to new trend forks.
The market is now approaching a truly critical position; the next week or two might be the moment that determines the fate of this cycle.
