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Breaking News: Bitcoin Exchange Gemini Makes A Splash On Nasdaq Debut, Jumping Nearly 50%
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Breaking News: Bitcoin Exchange Gemini Makes A Splash On Nasdaq Debut, Jumping Nearly 50%

Is Bitcoin Gonna See Another Big Drop Soon? Historical Trend May Say Yes

Keshav Verma
Keshav Verma
1 year ago
3 mins read
Bitcoin Bear

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Historical trend of the 200-day and 600-day MAs may suggest Bitcoin could observe another big drop in the near future.

Current Bitcoin Pattern Has Historically Lead To A Big Drop In The Price

As pointed out by an analyst in a CryptoQuant post, the current Bitcoin price looks to be squeezed between the 200-day and 600-day MA curves.

A “moving average” (or MA in short) is an analytical tool that averages the price of Bitcoin over any desired range. As its name suggests, this average constantly updates itself as each day passes by and new prices are observed.

The main benefit of an MA is that it evens out any local price fluctuations, and displays the trend as a smoother curve. This makes the tool quite useful for studying long-term trends, where day-to-day price changes aren’t as important.

Related Reading | Bitcoin LTHs Hold Significantly More Loss Now Compared To May-July 2021

An MA can be applied on any range of period. For example, a week, a hundred days, or even just one minute. The below chart shows the trend in the 200-day and 600-day Bitcoin MAs over the past several years.

Bitcoin 200-day And 600-day MAs

BTC price seems to be stuffed between the two moving averages right now | Source: CryptoQuant

As you can see in the above graph, a trend related to these MAs and the Bitcoin price has occurred following previous all-time highs.

It seems like during 2014 and 2018, after the respective ATHs formed and the price dwindled down, for a period the price was squeezed between the 200-day and 600-day MAs.

Related Reading | Why A “Boring” Bitcoin Could Be A Good Thing

After staying some time in the region, the MAs crossed over each other and the crypto observed a large drop in its price. Also, while this happened, the Bitcoin volume also experienced a downtrend.

Now, it looks like a similar pattern is starting to form this time as well. The price has dropped down since the November ATH, and it’s now stuck between the two MAs.

If the pattern holds and the moving averages cross over again, then another big drop may just be in store for the value of Bitcoin.

BTC price

At the time of writing, Bitcoin’s price floats around $40.4k, up 1% in the last seven days. Over the past month, the crypto has lost 1% in value.

The below chart shows the trend in the price of the coin over the last five days.

Bitcoin Price Chart

BTC's price seems to have seen a plummet over the past day | Source: BTCUSD on TradingView

Bitcoin showed some strong upwards momentum a couple of days back as it seemed to be approaching another retest of the $43k level. However, before any such revisit, the price plunged down in the last 24 hours.

Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com
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Keshav Verma
Keshav Verma

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Read more

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

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