A long-term price indicator has turned bearish for the first time in four years, threatening to impede continued gains in bitcoin‘s price.
Despite the rally late in the month, the cryptocurrency dropped 19 percent in May, according to Bitfinex data, pushing the 5-month moving average (MA) below the 10-month moving average for the first time since June 2014. The bearish moving average crossover validates the argument that long-term bull market has ended and indicates scope for further losses.
The monthly chart also shows BTC fell below $7,698 – the 61.8 percent Fibonacci retracement of the rally from $162 (2015 low) to $19,891 (2017 high) – last month, bolstering the already bearish technical setup.
However, the 4-hour chart is distinctly more bullish, indicating that gains could continue in the short-term.
Going strictly by the monthly chart, BTC could drop to the immediate support of $6,000 (February low) and possibly extend the decline further towards $4,384 (78.6 percent Fibonacci retracement)…