Bitcoin Price Breaks Below 50-MA For The First Time This Cycle, Why A Crash To $38,000 Could Be Coming
Overview
Bitcoin’s price has recently fallen below the 50-week Moving Average (MA) for the first time in the current cycle, raising concerns about a potential significant decline. This development has sparked fears of a price crash that could see Bitcoin drop to a considerably lower level.
Breakdown of the 50-MA
Crypto analyst Tony Severino highlighted that the recent price action represents a decisive shift in the market, as Bitcoin has slipped below the 50-week Moving Average for the first time during this four-year cycle. Historically, this MA has been a critical indicator, often marking the onset of extended downturns. Since Bitcoin’s inception over 14 years ago, every instance of closing below the 50 MA has been followed by a prolonged bear market.
Severino’s technical analysis emphasizes that in the previous three bear markets, Bitcoin’s price continued to decline after falling below the 50-week MA, with losses averaging around 62%. He has applied this historical data to the current market situation, suggesting that Bitcoin could be on track for a significant drop to $38,000 if the trend continues.
Momentum Indicators
In addition to the 50-week MA breakdown, Severino examined Bitcoin’s daily LMACD indicator, which is currently at low levels not seen in more than 1,250 days. The indicator has dipped below this level only six times since Bitcoin’s macro peak in 2017, and these periods have coincided with substantial downside momentum. The historical context suggests that Bitcoin may still be in the process of bottoming out.
The current reading of the LMACD is notably weak, indicating that market momentum has not yet reached extreme pessimism. This could imply that while Bitcoin remains in a downtrend, there may still be opportunities for price corrections before a true bottom is established.
Impact on the crypto market
- Bitcoin’s recent drop below the 50-week MA has triggered fears of a significant price decline.
- Historical data suggests that such a breakdown often leads to extended bear markets.
- The average losses following previous 50 MA breakdowns have been substantial.
- The LMACD indicator’s current low readings indicate that market momentum may still not have reached its most pessimistic state.
- Overall market sentiment may be affected as traders reassess their positions in light of these indicators.
Updated: 11/27/2025, 1:47:30 AM
