A bearish chart pattern known as a “death cross” is close to appearing in bitcoin’s chart.
The development is generating buzz Friday, and it’s illustrated in the above graphic — which is our Need to Know column’s chart of the day.
The “death cross” pattern occurs when the 50-day moving average drops below the 200-day moving average. The idea is that this cross marks the spot where a shorter-term decline is turning into a longer-term downtrend.
But technical signals derived from moving averages aren’t always good market-timing tools. That’s because they are often telegraphed, and they don’t have a great success rate, as MarketWatch’s Tomi Kilgore has noted.
Read more: Bitcoin struggles for stability, facing 10% drop for the week
And see: Bitcoin’s intrinsic value “must be zero,” says financial giant Allianz
Bitcoin BTCUSD, -1.07% hodlers can point to a different chart that’s signaling bitcoin at $91,000 within two years.