Bitcoin sees red as prices collapse, foreboding a BTC death cross
They don't call it a "death cross" because it bodes well.
One of the few reliable patterns that Bitcoin has been following lately is a tendency to make big movements following a period of tightened trading. That's what happened a few hours ago.
The trading range had tightened into a narrow band over time, heralding a big move one way or the other in the near future. Then the move happened, and it was downwards.
Bitcoin slipped under $8,000, then in a minute flat plunged to $7,700 and just kept going.
As is customary at times like these, people ask why. Or "why, oh God, why!" depending on how deeply invested they are.
There are a few possibilities at play here.
1. Libra momentum spluttering out?
There's a general sentiment that Libra momentum is puttering out. Mark Zuckerberg made another appearance in front of Congress, who asked a bunch of questions.
Those who didn't know what Libra was about, or really what they're doing, asked Zuckerberg questions like "are you 100% confident that vaccines don't present any threat to anyone on this planet?" and asked for reassurances that Facebook wouldn't block Trump re-election campaign ads.
Those who did know what Libra was about reiterated their condemnation of the project.
Libra is widely credited as being the main driver of the Bitcoin renaissance earlier this year, so it's understandable that markets may have reacted with disappointment to the show.
2. US regulators said they deliberately popped the 2017 bubble
Another factor is that former CFTC chairman Giancarlo said regulators deliberately popped the 2017 bubble.
If this is true, it really puts another nail in that "beyond the reach of government" coffin. It could be that the price slide was a delayed response to that.
3. Bitcoin giveth and crypto taketh, and this is takething
It could just be one of those things.
Bitcoin goes up and Bitcoin goes down. It does both at different times, in different amounts based on a lot of ineffable things, as well as the much more effable presence of market manipulation.
4. Death cross?
This drop also brings Bitcoin closer to that death cross.
This would be when the 50-day (blue line) and 200-day (orangey-yellow) moving averages cross.
This is basically an indicator which says what frame of mind Bitcoin is in.
In the lead up to the bullish yesteryears of late 2017, the blue line was well above the yellow, which is how you know Bitcoin was all jazzed up. But in the so-called "crypto winter" that followed, the yellow line was above the blue, which is how you know Bitcoin was feeling down.
So, if those lines cross again, it would be like formal confirmation of Bitcoin's bad mood.
It's called a "death cross" because it makes people cross.
Disclosure: The author holds BNB, BTC at the time of writing.
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