Bitcoin (BTC) fell to its lowest level in nearly 3 months with a sharp decline in the last 24 hours.
The largest altcoin, Ethereum (ETH), took its share of the decline, falling 11.8 percent in the last 24 hours to $2,375.
The picture is not encouraging for other altcoins either. Solana (SOL) fell 15.6 percent; XRP 13.7 percent; BNB 6 percent and AVAX 13 percent.
As the decline deepens, a death cross alert has sounded for Ethereum. Market analyst Omkar Godbole said that a death cross is approaching for ETH.
Accordingly, when looking at the Ethereum chart, a death cross will occur when the 50-day simple moving average (SMA) crosses the 200-day SMA and falls below it.
Looking at the Ethereum chart, it can be seen that the 50-day moving average is preparing to cross the 200-day moving average from top to bottom.
What is Death Cross?
Death Cross: A crossover where the short-term moving average crosses the longer-term moving average from top to bottom. This crossing is considered significant as a sign of major weakness.
So this pattern occurs when a shorter-term moving average, such as the 50-week, crosses below a longer-term moving average, such as the 200-week.
When this model is looked at technically, it is interpreted that the price will remain below the long-term average in the short term and that it could potentially experience another major decline.
A death cross is often seen as a warning for investors to be careful as it could lead to a significant price drop.
Only time will tell whether Ethereum will experience a death cross and trigger a drop.
What are the reasons behind the decline?
It is stated that this decline is due to Nasdaq futures indicating continued losses in technology stocks and the strengthening of the Japanese yen, and it is stated that the strengthening of the yen creates fears of risk aversion similar to the one in August.
Market analyst Omkar Godbole said that the Bank of Japan's interest rate hike talks and the yen's strengthening were reminiscent of last July and triggered the decline. Because after the Japanese central bank increased interest rates in July, the yen rose and led to a broad-based risk aversion trend. Bitcoin experienced a sharp drop from around $65,000 to $50,000 in a few days after the BOJ decision.
Analysts also noted that the crash occurred immediately after US President Donald Trump's statements on trade policies. Accordingly, Trump announced that tariffs on Canada and Mexico were proceeding as planned. This statement increased uncertainty in the markets and caused Bitcoin and altcoins to lose value rapidly.
*This is not investment advice.
