Cryptocurrency analyst and trader Ali Martinez is warning that Bitcoin (BTC) could go down by double-digit percentage points if it loses support at a key price level.
Martinez tells his 132,100 followers on the social media platform X that Bitcoin has come dangerously close to the support level provided by the 50-week moving average, a level that, when broken, has historically led to deep corrections.
According to Martinez, Bitcoin could drop by 44% from the current level if the price breaks below the 50-week moving average.
“Today the 50-week moving average sits at the $75,500. If this support level breaks, Bitcoin could drop to the 200-week moving average at $46,000.”
The crypto analyst and trader says that the 50-week moving average is the “ultimate Bitcoin bear signal,” and BTC has recorded at least four instances where it tested the 50-week moving average and ended up incurring large losses.
“Historically, when Bitcoin drops below the 50-week moving average, it tends to test the 200-week moving average. For instance, in 2014, when Bitcoin dropped below the 50-week moving average, it went all the way down to test the 200-week moving average.
In 2018, the same thing happened. After Bitcoin dropped below the 50-week moving average, it went and tested the 200-week moving average.
Even in 2020, during the Covid crash, Bitcoin dropped below the 50-week moving average and tested the 200-week moving average.
And in 2022, the price correction was more significant. Bitcoin even went below the 200-week moving average.”
Bitcoin is trading at $84,771 at time of writing.
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