In a dramatic turn of events over the weekend, Bitcoin tumbled to $93,029, marking a significant drop below its January 1 starting price of $93,507 for the first time this year. This downturn also reflects a steep 25% decline from its all-time high of approximately $126,000 set in October, a period which saw the cryptocurrency landscape flourish under pro-crypto policies.
As Bitcoin trades well below its peak, other cryptocurrencies are feeling the pinch too, with Ethereum slipping 7.95% and Solana down 28.3% since the year’s start. The market is now bracing for the emergence of a “death cross,” a technical chart pattern that usually indicates further downside pressure.
Technical Patterns Signal Caution
The anticipated death cross occurs when the 50-day moving average (currently at $110,669) dips below the 200-day moving average (at $110,459). Traders often interpret this move as a bearish signal, yet historical context reveals a different narrative for Bitcoin’s recent cycles.
Data from Glassnode indicates that similar death crosses have previously marked local bottoms in this crypto cycle rather than signifying prolonged downturns. In fact, instances in September 2023 and August 2024 demonstrated that Bitcoin managed to stage recoveries of 70-195% following its death cross formations.
Amid this selloff, a recent tweet from influential analysts supports optimism: “If Bitcoin is still in a bull run, it has either already bottomed or is poised to do so soon,” further hinting at the inevitable market shifts that often follow fear-laden selloffs.
During the latest adjustment, however, the drop has lingered longer and deeper than previous corrections. Those observing the market patterns will recall that Bitcoin saw a significant decline after the government reopened on November 12, shedding 10% in value—a phenomenon reminiscent of the 2019 government shutdown that resulted in a similar market dip.
A Pattern of Recovery?
The month-long correction ultimately raises the question of whether Bitcoin will soon reverse its fortunes. After the government reopened, analyst activity has shown that older Bitcoin holders are trimming their stakes, a behavior deemed typical for the late stages of a market cycle. This kind of profit-taking is something we often observe, suggesting a more resilient market rather than a panicked exodus.
Corporate entities have also ramped up their adoption of Bitcoin, with steady inflows into spot Bitcoin exchange-traded funds (ETFs) bolstering market confidence. The pro-crypto commitments from the Trump administration have continued, promising an appeal to both institutional and retail investors alike.
Looking ahead, experts like Matt Hougan of Bitwise express a positive outlook for 2026, underlining the growth potential of stablecoins, tokenization, and decentralized finance as critical components of the evolving financial landscape.
Although Bitcoin has rebounded slightly from its weekend low, it still needs to regain momentum to exceed its starting price for 2025. As traders and investors keep an eye on the evolving chart patterns, the hope for a substantial rally following the potential death cross remains alive.
