Bitcoin Slices Through Key Technical Price Level, Where is the Bottom?

Key Insights:

• Bitcoin has fallen below the 200-week moving average.
• The technical indicator is a long-term support level for Bitcoin prices.
• Analysts predict more pain on major macro-economic fear and uncertainty.

Bitcoin prices have fallen through a crucial support level which has served as the bottom in previous bear markets. The 200-week moving average has been a critical level of support for long-term Bitcoin price movements in previous market cycles.

BTC prices plunged through this key level in a fall to just over $21,000 during the Tuesday morning Asian trading session. The 200-week moving average was around the $22,000 price level, but this has failed to hold, with prices currently hovering around $21,883, according to Tradingview.

The move was noted by analyst and trader Josh Rager, who tweeted “help us all” on June 14.

Not even the 200W MA can save $BTC

Help us all pic.twitter.com/fZ6shmCW2D

— Rager 📈 (@Rager) June 13, 2022

Partner at Placeholder VC, Chris Burniske, also commented on the implications of falling through such a solid level of support:

“Structural macro flows are so against us, it likely only matters when the risk-tides turn, could be entering relatively uncharted bear territory for crypto soon here. The fight going on in markets is much bigger than us.”

Unprecedented Fear

Bitcoin has currently fallen 69% from its November all-time high, and in previous bear markets, the decline was more than 80%, so there could be more pain to come. BTC could realistically fall to around $13,000 if history rhymes with this crypto winter.

What appears to be apparent during this cycle is that it is different from previous ones. The entire planet is in economic turmoil with galloping inflation and a cost of living crisis. Very few have any money to invest in anything, and fear and doubt are at unprecedented levels.

Bitcoin Fear and Greed Index is 8. Extreme Fear
Current price: $22,319 pic.twitter.com/mH2KGtCkiu

— Bitcoin Fear and Greed Index (@BitcoinFear) June 14, 2022

Analyst Alex Krüger pitched in with his take, which supported the notion that there was a wider spread fear occurring:

“Realize how little this crypto dump has to do with Celsius and the stETH drama and all to do with the widespread panic in risk assets (equities and crypto alike) and broken charts.”

The “broken charts” have rendered a lot of traditional technical analysis (TA) ineffectual since the patterns and indicators have not been adhered to this time.

However, it is not just crypto getting hammered as stocks across the board are also getting smashed.

every stock in the S&P 500 is red right now pic.twitter.com/vhrfVc1NIz

— Katie Greifeld (@kgreifeld) June 13, 2022

Where Lies The Bitcoin Bottom?

With the FUBAR state of TA, it has become challenging to predict the movements of crypto markets over the next few months. Nevertheless, it would be safe to say that the bears are not finished yet.

The total market cap has dumped 70% to below $1 trillion for the first time since January 2021, so the previous high of $830 billion in January 2018 does not seem that far off now.