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Bitcoin is still due to close a daily chart “death cross,” but $62,000 resistance could be key to mitigating the BTC price downside which has followed in the past.
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Bitcoin (BTC) can beat its imminent “death cross” if it flips $62,000 to support, the latest analysis says.
In a dedicated X thread on Aug. 9, popular trader Benjamin Cowen used history to suggest how bulls might avoid a fresh BTC price dive.
$62,000 becomes key BTC price resistance hurdle
Recent BTC price action has led BTC/USD to the door of another moving average crossover classically known as a “death cross.”
This involves the downward-sloping 50-day simple moving average (SMA) crossing below its 200-day equivalent. Currently, the 50-day and 200-day SMAs stand at 61,998 and 91,882, respectively, per data from Cointelegraph Markets Pro and TradingView.
The Death Cross gets its name from the assumption that the crossover acts as a prewarning for the downside of the BTC price once it is complete.
As Cowen shows, however, the results are often mixed, with the last daily death cross in 2023 in fact precluding a bout of gains.
“In 2023, BTC started its rally just after the death cross. It then got above its 50D SMA and subsequently held it as support before going higher,” he noted.
By contrast, in 2019, 2021 and 2022, a brief tap higher into the death cross event itself ultimately gave way to the expected result — losses.
“The durability of this move will likely depend on first BTC getting above its 50D SMA ($62k), and then holding it as support like it did in 2023,” Cowen concluded.
He added that should that fail, downside may return until macroeconomic conditions notably change. Specifically, the United States Federal Reserve should perform a “sufficient pivot” on interest rates to boost crypto and risk assets.
Bitcoin open interest sluggish on BTC price rebound
BTC/USD continued its recovery on the day, reaching $62,775 into the prior daily close before returning to consolidate slightly lower at the time of writing.
Related: Bitcoin reclaims $62K, forming a ‘massive bull hammer’ on price chart
Market observers noted a lack of rebound in futures market open interest despite the higher prices, this coming days after a giant flush rarely seen in Bitcoin’s history in terms of scale.
“This Bitcoin bounce has been mostly shorts covering positions in the futures market,” Julio Moreno, a contributor to onchain analytics platform CryptoQuant, wrote in part of an X response.
Fellow contributor Axel Adler Jr meanwhile flagged the area above $62,000 as key resistance, with major support still at this week’s six-month lows beneath $50,000.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
This article first appeared at Cointelegraph.com News
