What to Know
- Bitcoin’s weekly SuperTrend indicator has flipped to a sell signal, major corrections of 38%–75% coming.
- Market pressure is intensifying with over $1B liquidations, ETF outflows, and Mt. Gox wallet movements.
- Bitcoin must reclaim $93,000 and slow down outflows to avoid deeper losses, as a 61% historical average drop is imminent.
Bitcoin may be heading into another rough phase. The well-known SuperTrend indicator on Bitcoin’s weekly chart has flipped to a sell signal, something that has often predicted major price drops in the past.
The SuperTrend indicator is widely followed because it has a long history of correctly spotting big trend changes. And when it turns bearish on the weekly timeframe, Bitcoin has usually seen a large correction afterward.
A 10-Year Pattern
Since 2014, every major SuperTrend sell signal has led to a significant decline:
- February 2014: Bitcoin fell 75%
- January 2018: Bitcoin fell 73%
- October 2019: Bitcoin fell 54%
- May 2021: Bitcoin fell 38%
- January 2022: Bitcoin fell 67%
This long, consistent pattern is why many analysts are now paying close attention. If we take the average of all these past declines, the number comes out to roughly 61%. Based on this historical average, Bitcoin could drop toward $40,000 if the same type of correction plays out.
Unlike many short-term signals, the SuperTrend works on longer timeframes, especially the weekly chart, which gives it more weight. Over the last decade, almost every time the SuperTrend flipped bearish, Bitcoin and subsequently the whole crypto market entered a period of steep decline. The indicator doesn’t just capture small dips, it has historically shown up right before major trend reversals. That is why some see it as a “cycle signal”.
Market Pressure Builds
In the last 24 hours, more than $1 billion worth of crypto trades were wiped out as prices fell. Nearly three-quarters of those losses came from traders who were betting on prices going higher. This forced selling sped up the decline as Bitcoin broke below the important $93,000 level. The market’s “Fear & Greed” reading is now at Extreme Fear, similar to levels seen during previous sharp crashes.
Bitcoin spot ETFs saw $255 million in outflows in one day. This was the fifth straight day of withdrawals. BlackRock’s popular ETF saw the biggest exit, losing $146 million in a single day. With whales moving money out, buying pressure has weakened, adding to Bitcoin’s downside risk. At the same time, the Mt. Gox estate moved more than 10,600 BTC, worth over $950 million, raising fears of possible selling pressure in the near future.
Short-term Bitcoin holders are also in trouble: the share of Bitcoin supply held by holders who bought recently and are now at a loss has climbed to its highest level since the 2022 FTX collapse.
Technical Breakdown
Bitcoin has also slipped below key levels that traders watch for support. The price fell under the $93,000 support level and the 200-day moving average, which is around $108,000. At the time of writing, BTC is trading at around $90,537.
The RSI14 at 28.9 signals oversold conditions. Historical data shows 30%+ corrections are common in bull cycles. A “death cross” is now forming again. In some years, a death cross marked a local bottom. But in 2022, it kicked off a full bear market. That is why traders are unsure what it means this time.
What Happens Next?
The big question now is simple: is this the start of another deep correction, or just a temporary dip? For Bitcoin to recover, analysts say that the price must climb back above $93,000 and ETF outflows should slow down. Additionally, liquidations need to settle, and fear in the market must ease. Until then, the SuperTrend sell signal is flashing loudly. If the past decade is any guide, Bitcoin may be entering another corrective phase and a potential 61% drop remains a real risk.
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