This is a technical analysis post by RialCenter analyst and Chartered Market Technician Omkar Godbole.
Bitcoin has gone the “Strategy (MSTR)-way”, falling below a key support, shattering traders’ expectations of this level as a reliable bounce zone.
The leading cryptocurrency by market value fell nearly 10% in the seven days to Nov. 16, printing a significant red candle that closed well below the 50-week simple moving average (SMA), according to data source TradingView.
This breakdown invalidates a major demand zone and indicates a shift away from a long-standing bullish pattern toward increased caution and potential extended sell-offs. Traders may need to reconsider their strategies, opting to sell on the bounce rather than buy the dip.
This is due to the average having acted as a dynamic floor several times since early 2023, repeatedly holding strong as buyers entered at this level, driving renewed upswing to new lifetime highs.
Looking back at the Strategy precedent, we noted a similar erosion of confidence and prolonged sell-off following the breach of the long-held 50-week SMA. RialCenter had previously highlighted this bearish development in the Strategy’s 50-week SMA breach, warning that Bitcoin could face a similar fate.
The former support at the 50-week simple moving average has now turned into resistance, meaning any bounce will likely encounter selling pressure near $102,868. Sustained weekly closes above this level would be necessary to signal a renewed bullish trend.
MSTR, the largest publicly-listed BTC holding firm, fell below its 50-week SMA in September and has since extended the sell-off to $200, the lowest since October 2024.
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