Bitcoin has slid to around $68,500, bringing renewed attention to a “weekly dead cross” that occurred in July.
The 50-week moving average fell below the 100-week moving average shortly after the July low, blockchain media outlet The Crypto Basic reported on Nov. 12. In the past, this type of signal appeared near major lows, but there were also cases where additional declines followed.
The indicator uses simple moving averages calculated from weekly closing prices. The 50-week line reflects about 1 year of price action, while the 100-week line reflects about 2 years. When the shorter-term average drops below the long-term average, it indicates that recent price weakness has accumulated.
Moving averages are strongly lagging indicators, however. Because they reflect long periods of prices, a bearish crossover can appear after a sharp drop is under way or after a bottom has formed. In two of the three prior instances excluding this case, Bitcoin had already posted a low before the dead cross occurred.
The time it took to reach a bullish crossover is also drawing attention. In 2016, 2019 and 2023, the 50-week line moved back above the 100-week line about 9 to 15 months after the dead cross. Applying the same interval to this July puts the next bullish crossover at April to October 2027. This is a simple application of past timing and does not foreshadow when prices will rebound.
There are also cases suggesting the possibility of further declines. In September 2022, a dead cross appeared before the final low, followed by about 10 weeks of declines. That is why the fact that the signal emerged near past lows does not allow a definitive conclusion that the July low will hold.
Bitcoin has fallen to around $68,500 and is trading below both the 50-week and 100-week lines. After it also lost $74,000, previously cited as a long-term support level, the key point to confirm is whether it can regain that price level.
To confirm an improvement in the trend, weekly closing prices need to stay above the moving averages consistently, beyond a temporary rebound. A recovery signal could gain strength if price lows gradually rise and the 50-week line also turns upward.
The key going forward is whether the July low holds. If a new low forms below it, the interpretation that this cycle’s bottom was made in July will lose persuasiveness. If it holds that low and weekly price action improves, there remains room to interpret this dead cross as a belated signal that appeared near a low.
