The report states, “Technical gauges signaling long-term buying demand for Bitcoin are deteriorating” and as such, buying pressure could increase. Bloomberg notes that the seminal crypto’s Moving Average Convergence Divergence (MACD) indicator has been moving downward since mid-February.
The MACD is a trend-following indicator of momentum that shows the relationship between two moving averages of the price of a security.
Bitcoin has tested the $4,000 mark several times in previous weeks, but has as of yet been unable to break above it for a meaningful period of time. Bloomberg states that, until Bitcoin can break through that level, it is likely to face selling pressure. Bloomberg analyst Mike McGlone said:
“The entire industry is ripe to resume a path to lower prices. Conditions are akin to November , just prior to the collapse. Prices are consolidating within narrowing ranges, with a few sharp bear-market rallies that appear fleeting.”
Other industry experts have suggested that investors are forgoing Bitcoin to move their money into altcoins. EToro senior market analyst Mati Greenspan said:
“It’s just that investors are seeing more potential in some of the smaller tokens at the moment. As we approach the culmination of the crypto winter, we’re actually seeing some of the altcoins delivering spectacular gains in the last few weeks. We are now in what industry insiders like to call alt-season.”
At press time, data from TradingView shows that the Bitcoin MACD is at 44.3, pointing to a “sell” recommendation. The coin is currently trading at $3,910.57, up a modest 0.48 percent on the day according to CoinMarketCap.
Bitcoin 3-month price chart. Source: CoinMarketCap