BTC-USD Review of Past Year's Price Deviation from 200 SMA
Reviewing the past 5 major BTC price corrections it is interesting to note that the crash occurred consistently when the price deviated about 60% from the 200 SMA.
The crash in Mid December happened when the price was a staggering 75% above 200 SMA. Even when it recovered there was still a 34% divergence. When this started to climb again above 50% divergence this should have range warning bells.
The current crash looks to have found its bottom with it back at a 23% divergence from the 200 SMA. Longs should be able to be placed confidently with new All Time Highs expected before next correction.
Lessons
- Current crash seems to have bottomed
- Look out for the price deviation from 200 SMA. Ensure you are not in significant long positions when it deviates above 50% of the 200 SMA.
The crash in Mid December happened when the price was a staggering 75% above 200 SMA. Even when it recovered there was still a 34% divergence. When this started to climb again above 50% divergence this should have range warning bells.
The current crash looks to have found its bottom with it back at a 23% divergence from the 200 SMA. Longs should be able to be placed confidently with new All Time Highs expected before next correction.
Lessons
- Current crash seems to have bottomed
- Look out for the price deviation from 200 SMA. Ensure you are not in significant long positions when it deviates above 50% of the 200 SMA.
