This is a technical analysis post by CoinDesk analyst and chartered market technician Omkar Godbole.
bitcoin has followed the path of the “Strategy (MSTR)”, falling below a key support to break the memory that traders had of this level as a reliable bounce zone.
The leading cryptocurrency by market value fell almost 10% in the seven days to November 16, printing a large red candle that closed well below the 50-week simple moving average (SMA), according to data source TradingView.
The breakout represents an invalidation of a major demand zone and a transition from an entrenched bullish pattern toward greater caution and a potential prolonged sell-off. Traders can reconsider their assumptions and change tactics to sell during the rebound instead of buying during the decline.
This is because the average had acted as a dynamic floor several times since early 2023, repeatedly holding strong as buyers moved around the level, fueling a renewed rally towards new all-time highs.
Looking at the strategy’s precedent, we see a similar erosion of sentiment and a prolonged sell-off following the break of the long-standing 50-week SMA. CoinDesk previously noted the bearish development on Strategy’s 50-week SMA break, warning that Bitcoin could face a similar move.
Former support at the 50-week simple moving average has now turned into resistance, meaning any bounce will likely face selling pressure near $102,868. Sustained weekly closes above this level would be needed to signal a renewed uptrend.
MSTR, the largest publicly traded BTC holding, fell below its 50-week SMA in September and has since extended the sell-off to $200, the lowest level since October 2024.
