Over the past week, Bitcoin’s price continued to set new lows, with little sign of a bullish turnaround. However, on Friday, February 13th, the leading cryptocurrency gained upward momentum, rising 5.4% in value. While this provided an opportunity for short-term traders, especially scalpers, a concerning outlook may still be ahead for Bitcoin, based on a recent technical analysis.
SuperTrend Indicator Shows Sell Signal on Bitcoin’s Monthly Chart
In a February 14th post on X, prominent technical analyst Ali Martinez suggested that Bitcoin could be approaching a major shift in its long-term trend. This assessment relies on the SuperTrend Indicator, a tool used to identify whether an asset is in an uptrend or downtrend.
The indicator displays a dynamic line that acts as support during uptrends and resistance during downtrends. When the price is above this line, the market is considered bullish; when below, it is bearish. A decisive close below the line after an uptrend signals a potential shift to a bearish phase.
Notably, on the monthly chart, Bitcoin’s price is now trading below the SuperTrend line, hinting at a possible bearish tilt. This pattern resembles past cycle transitions. Historical charts shared by the analyst show that before the bear markets of late 2014-2015, 2018, and 2022, the SuperTrend Indicator flashed similar sell signals, each preceding a prolonged downturn.
Given that this signal appears on Bitcoin’s monthly chart, it could indicate a long-term retracement typical of a bear market. However, current market conditions differ from previous cycles, with greater institutional involvement and the introduction of ETFs broadening investor access. These factors may influence the current cycle’s trajectory.
If the sell signal coincides with on-chain activity and macroeconomic events, and Bitcoin closes below the SuperTrend line, a bear market could follow, potentially leading to a decline of 60% or more in Bitcoin’s value.
Conversely, if new demand enters the market and Bitcoin shows resilience, this signal might serve as a short-term warning rather than the start of a sustained bear market.
Bitcoin Price Overview
At the time of writing, Bitcoin is valued at approximately $68,984, marking a 4.5% increase over the past 24 hours. According to CoinGecko data, the cryptocurrency has declined about 29% over the past month.
Frequently Asked Questions
Of course Here is a list of FAQs about the reappearance of a Bitcoin signal that preceded a major 60 drop written in a natural conversational tone
Beginner Definition Questions
1 What is this signal everyone is talking about
Its a specific technical indicator or onchain metric that flashed a warning sign just before Bitcoins price fell sharply in the past Analysts have noticed the same signal appearing again now
2 What exactly is the signal called
While the specific indicator can vary reports often refer to signals like a death cross extreme readings in the Relative Strength Index or key support levels breaking on high volume The recent news likely points to one of these classic technical warnings
3 Does this signal guarantee a crash will happen
No Its a warning not a guarantee Past performance does not guarantee future results The signal suggests increased risk and a higher probability of a downturn but markets can sometimes defy historical patterns
4 Im new to crypto Should I sell all my Bitcoin because of this
Not necessarily based on one signal alone This is a risk indicator Beginners should consider their own investment goals risk tolerance and never invest more than they can afford to lose Its a good moment to review your strategy not necessarily panic sell
Advanced Market Analysis Questions
5 What was the historical context of the last 60 drop it predicted
The last major drop this signal preceded was likely the bear market of 2022 where Bitcoin fell from alltime highs near 69000 to below 16000 driven by macroeconomic tightening inflation and industry collapses
6 Are current market conditions similar to last time
Similar in some ways but also different The market now has Bitcoin ETFs greater institutional involvement and different regulatory dynamics The context matters as much as the signal
7 What are other indicators saying right now Is this signal isolated
Savvy traders never rely on one signal They are checking other metrics like Bitcoins MVRV Ratio exchange reserves funding rates in derivatives markets and broader stock market trends to see if theres confirming or conflicting evidence