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Bitcoin falls below 200-day SMA, posing dual price outcomes

Bitcoin falls below 200-day SMA, posing dual price outcomes

GrafaGrafa2024/08/19 06:45
By:Isaac Francis

Bitcoin (CRYPTO:BTC) has experienced remarkable growth over the past two years, increasing by over 300% since early 2023 and reaching a new all-time high of $73,750 in March 2024.

However, recent developments suggest that Bitcoin’s bullish momentum could face hurdles in the upcoming months. 

A critical factor influencing this outlook is Bitcoin’s recent dip below its 200-day Simple Moving Average (SMA), a key trading indicator used to identify long-term price trends.

The 200-day SMA represents the average price of an asset over the past 200 days, serving as an essential tool for traders. 

When an asset’s price moves above this average, it typically signals an upward trend, while a drop below the SMA is often viewed as a bearish signal, indicating a potential decline in value.

Crypto analyst Ali Martinez has noted that Bitcoin’s drop below the 200-day SMA might be temporary, potentially offering a buying opportunity for investors. 

Martinez suggests that if Bitcoin can quickly recover above the 200-day SMA, it may continue its bullish trajectory. 

However, if Bitcoin stays below this level for an extended period, it could mark the beginning of a bear market.

Currently, Bitcoin is trading at $59,995, reflecting a 1.77% decline over the past week. 

The cryptocurrency has struggled over the last month, losing more than 8% of its value and briefly dipping below $50,000.

Despite these challenges, sentiment within the Bitcoin community remains largely positive, with many investors expecting long-term gains.

Bitcoin’s short-term price targets are set at $62,000 and $70,000, both significant resistance levels.

The future direction of Bitcoin’s price will hinge on whether it can overcome these challenges and regain its upward momentum.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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