Three important Bitcoin momentum signs recently made a “death cross,” according to an expert at CryptoQuant. This could mean that the market is about to turn bearish.
Indicators based on moving averages (MAs) show that people who buy Bitcoin are becoming less interested and making less funds. The first one is called “Active Address Momentum,” and it looks at the rates of Bitcoin addresses that are still active over the last 30 and 365 days.
When these names take part in network events, we call them “active.” It looks like the 30-day MA is now lower than the 365-day MA. This means that the blockchain is not being used as much. It has been seen in the past that this trend makes investors lose interest, which could stop price growth in the future.
Bitcoin’s 2021 Crossover Pattern
In the middle of 2021, just before Bitcoin’s bull run finished, a similar crossover took place. Even though there was a second rally in the coin later that year, it looks like investors are becoming less interested right now.
The Market Value to Realized Value (MVRV) ratio is the second sign. It shows whether buyers are making funds or losing funds. The monthly MA of the MVRV ratio has fallen below its yearly MA, which shows that profits are going down and is in line with past bearish trends. Before the bear market in 2022, this trend showed up again.
Finally, a negative crossover between Bitcoin’s 50-day and 200-day moving averages makes a drop even more likely.
Analysts think Bitcoin may be going for a short-term bearish period because of these negative signals from a number of different indicators. Its price has already dropped to about $56,500 because of recent problems.
Investors should keep a close eye on these trends because they could mean that BTC will be going through a long period of falling prices.
