According to crypto analyst Tony Severino, the Bitcoin price has broken below the 50-week Moving Average (MA) for the first time in the current cycle, triggering renewed fears of a deeper decline. With price momentum weakening and long-term trend indicators flashing bearish warning signals, the possibility of a price crash to $38,000 is becoming hard to ignore.
50-MA Breakdown To Trigger $38,000 Bitcoin Price Crash
The Bitcoin price action took a decisive turn this week as the market slipped below the 50 MA for the first time in this four-year cycle. Severino noted in his technical analysis shared on X this Monday that the 50 MA has historically marked the beginning of extended downturns. He stated that following Bitcoin’s launch over 14 years ago, every time it has closed below the 50 MA, a prolonged bear market has followed.
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Severino’s price chart highlights BTC’s price performance from 2017 to date. In the past three Bitcoin bear markets, after the price fell below the 50-week MA, BTC continued to drop an additional 61%, 59%, and 67%. On average, the cryptocurrency has lost 62% from the break point.
Applying the 62% drawdown to this cycle’s 50 MA level, the analyst predicts Bitcoin could soon experience a price crash to $38,000. From the cryptocurrency’s current price of above $87,000, this represents a staggering 60% decline. Additionally, it would imply a roughly 70% decline from its all-time high of more than $126,000.
Severino warns that traders calling for a price bottom may be ignoring how far Bitcoin has historically fallen once this long-term trend fails. He indicated that the 50-week MA has repeatedly served as a dividing line between bullish and bearish phases, and that price slipping below it has more often led to extended periods of weakness and capitulation.
Bitcoin Momentum Indicator Falls To Historic Lows
A second analysis presented by Severino focuses on Bitcoin’s daily LMACD, which is now near levels not seen in more than 1,250 days. The oscillator has only pushed below this level six times since BTC’s 2017 macro peak. These past instances correspond to periods of heavy downside momentum where the cryptocurrency had yet to complete its bottoming process.
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Looking at Severino’s price chart, the extended period without revisiting this lower bound suggests Bitcoin may be overdue for a momentum reset. The LMACD indicator’s current reading is also unusually weak historically, signaling that market momentum has not yet reached extreme pessimism.
The readings further indicate that, although BTC remains in a downtrend, price corrections remain possible before a true bottom is established. According to CoinMarketCap data, Bitcoin is trading below $87,000 amid volatile, choppy conditions that have contributed to its 24% decline over the past month.
Featured image from Pngtree, chart from Tradingview.com
