Why Bitcoin Retracing Last Year's Bear Market May Plunge Further

Technical indicators suggest that cryptocurrency Bitcoin, whose recent price is more than 30% off its 2019 high in July, may fall yet more. “The best way to describe the market is it’s retracing last year’s bear market,” Mike McGlone, an analyst with Bloomberg Intelligence, indicated in a Bloomberg report. “It’s in no hurry to take out the old highs--there’s a hangover of residual selling from the parabolic rally in 2017. There’s just a lot of people who bought it, got way too overextended, who will be responsive sellers,” he added.

Among digital assets, Bitcoin is the most widely-held and widely-watched, as well as the largest by market value at about $155 billion. The trading range between its 50- and 200-day moving averages is now narrower than any previous time since June. Moreover, Bitcoin's current price fell further as of mid-day Thursday, is below its 50-day moving average, and an additional drop below its 200-day average may represent a sell signal.