- Bitcoin has now traded within 10% of is 50-day moving average for 51 days through March 26, the longest stretch of such tight trading since July 2020, according to data from Bloomberg.
- Like many other risk assets, Bitcoin faces a slew of headwinds, from soaring inflation to central bank policy tightening that’s left it rangebound for most of this year.
In the last week of March, Bitcoin bulls cheered as the world’s biggest cryptocurrency by market cap finally broke out of a tight trading range and a rough start to the new year.
Since then, Bitcoin has reverted back to its original trading band and as the benchmark cryptocurrency hovers near a key trendline again, bulls are increasingly concerned whether they’re being set up for another round of disappointment.
Bitcoin has now traded within 10% of is 50-day moving average for 51 days through March 26, the longest stretch of such tight trading since July 2020, according to data from Bloomberg.
And Bitcoin is now headed close to an even more significant threshold, its 200-day moving average, where it’s sat below for 95 days, the longest streak of a bearish pattern since April 2019.
Chart watchers will note that this head-and-shoulders pattern could see Bitcoin move in either direction, but risks heavily weighted to the downside.
Like many other risk assets, Bitcoin faces a slew of headwinds, from soaring inflation to central bank policy tightening that’s left it rangebound for most of this year.
Stocks could provide clues as to where Bitcoin is headed to next, with the cryptocurrency sharing a strong correlation with the S&P 500 and a 90-day correlation coefficient with the index at 0.55, according to data from Bloomberg (a coefficient of 1 means that two assets move in lockstep).
Nevertheless, cryptocurrency products are still seeing inflows, with data compiled by UBS showing digital asset ETFs attracted around US$550 million over the past two weeks.
