Bitcoin (BTC) traded below chart support at 30,000.00 on Tuesday, down to 28,800.01. This weakness occurred due to the formation of a death cross over the weekend. This will be shown on the daily chart below.

The death cross occurred when the 50-day simple moving average fell below the 200-day SMA. These levels are well above its annual value level at 18,798.71, which is the downside risk.

The downside accelerated when bitcoin failed to hold its semiannual pivot at 35,643.29 on Monday. This week’s pivot at 33,214.67 was a magnet that provided the near-term stability. The June 23 high is at 34,854.46 so far.

The daily chart for Bitcoin:

Courtesy of Refinitiv XENITH

The daily chart for bitcoin clearly shows the formation of the death cross. The blue line is the declining 50-day simple moving average at 41,019.08. The green line is the rising 200-day SMA at 43,194.68. The horizontal lines from bottom to top are its annual value level at 18,893, its semiannual pivot at 35,643, its quarterly pivot at 40,283, and its monthly risky level at 61,916.

With the bubble popped, bitcoin will be extremely volatile. Use moving averages and my value levels, pivots and risky levels to capture the choppy trading patterns for bitcoin. The semiannual pivot at 35,643 has been a magnet today.


The weekly chart for Bitcoin:

Courtesy of Refinitiv XENITH

The weekly chart for bitcoin is negative. It’s below the five-week modified moving average at 39,988.30. The downside risky is to the 200-week simple moving average at 13,346.70. This would be a return to the reversion to the mean, which clearly held between November 2018 and March 2019. This key moving average held again in March and April 2020.

Note the down trend line between the high of 19,458.19 in December 2017 and the high of 13,895.10 in June 2019. This downtrend was broken out to the upside during the week of August 2, 2020. This was a major buy signal.

Note that the 13x3x3 weekly slow stochastic reading is declining at 22.62. This means that bitcoin is not yet oversold. If this reading were to decline below 20.00 it would become oversold.

The long term buy recommendation occurs when the reading falls below 10.00, as such a move would make bitcoin too cheap to ignore.