Bitcoin (BTC), the largest cryptocurrency by market capitalization, has shown a “death cross” on its short-term charts. This comes after a massive sell-off in the cryptocurrency market, with Bitcoin falling to a low of $49,050 during yesterday’s trading session. Despite this, Bitcoin has shown resilience, returning from its lowest point.
As of early Monday, over $370 billion had been erased from the market capitalization of all crypto assets over 24 hours. Bitcoin has experienced its most extraordinary single-day drop in three years. Much of the sell-off was linked to a broader market rout, with equities falling worldwide.
A death cross, a significant technical indicator in the cryptocurrency market, occurs when a short-term moving average crosses below a long-term moving average. This typically signals potential bearish momentum, indicating a possible downturn in the market.
As for BTCUSD, this pattern has emerged on the four-hour chart as the 50-hour moving average has crossed below the 200-hour moving average, an indication that many market analysts view as a bearish signal.
Crypto market recovers
On Tuesday, cryptocurrencies recovered some of the losses from the previous day. Bitcoin is regaining ground after plummeting to its lowest level in six months on Monday during the first big test of the recently launched crypto exchange-traded funds. This recovery signals hope for the future of the cryptocurrency market.
According to CoinMarketCap data, Bitcoin was up 9% in the last 24 hours to $54,851. This price increase suggests that Bitcoin has the potential to rise further, bringing optimism to the market.
On-chain analytics firm IntoTheBlock highlighted vital levels to watch as the Bitcoin price shows signs of recovery.
According to IntoTheBlock, on the upside, resistance is pretty distributed. However, two price levels with notable historic volume stand out: $55,500 and $60,500.
On the other hand, if declines continue, a significant demand level will be concentrated below $50,000, with solid support anticipated around $47,500.
Meanwhile, Bitcoin wallets between 1,000 and 10,000 BTC showed confidence during the recent dip, consistently increasing their holdings as prices fell. On the other hand, wallets with less than 1 BTC showed weak hands, with the most substantial decrease in holdings during yesterday’s market downturn.
