Hey tradingview friends! I hope you are having a wonderful day :) I would like to welcome you to this update on Bitcoin! I did a recent idea about this "double death cross" and, sure enough, Bitcoin continues to drop. Before I continue any longer I would like to explain what this "death cross" means and how I came to this conclusion. What is a double death cross?
I know, I know it may sound frightening but this is actually a common pattern and formation that you will discover in Forex, Stocks, and now Cryptocurrency. How I got to this conclusion was by using three specific indicators (All Simple Moving Averages).
They are:
50 Period Simple Moving Average 100 Period Simple Moving Average 200 Period Simple Moving Average
When the green (50 MA line) crossed the red (100 MA line) that was signal #1 of the death cross. Next, the 50 MA line needs to cross the 200 MA line. It is just about ready to cross 200 MA line which is the confirmation of a double death cross. The outcome if this happens? Not good for BTC. When the double death cross occurs it is common to see a HUGE move to the upside, or in this case, downside. Where will it go? No one really knows that answer but we can all speculate. We can find support at 5000 so is that where it is heading? Maybe, maybe not, but get ready for the ride because it is going to get BUMPY!
Please note that the double death cross pattern is best spotted on the Daily Time Chart.
As I am writing this, it continues to drop. I will update this post when I can.
Moving averages, like all indicators, follow the price. They do not anticipate it. The price does whatever it wants in despite of the indicators.
Tradingstrategyguides
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@flashpaul, Thanks for the comment. It does, but having tools to help you is definitely a bonus.
Fredlot
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Correction:
It seems that the 50 EMA has not definitely crossed the 200 EMA.
Fredlot
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It seems that the Double death situation has reached a support base at present on the 200 EMA as it seems that the 50 Moving average has not definitely crossed the 100 EMA
and the 100 EMA is still far from reaching the 200 downward.
The worst scenario in my view would be that in a downward continuation the next support base would be found at the November 2017 low of around 5800.
Fred Lottering
sunil21665
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Price action does everything for you much in advance before this double or tripple death cross does.
Tradingstrategyguides
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@sunil21665, This is a great confirmation signal. You don't just trade based on what moving averages are doing. However, these tools help traders visualize. Thanks for the comment.