A widely followed momentum indicator that has consistently flagged bitcoin selloffs in recent months has turned negative again, raising fresh concerns for bullish traders.
Bitcoin is flashing a warning signal as the moving average convergence divergence (MACD) histogram dips below zero for the third time since its October peak—pointing to a renewed shift toward bearish momentum.
Understanding the signal
The MACD is built around two core lines. The first, the MACD line, measures the difference between the 12-day and 26-day exponential moving averages (EMAs), helping gauge momentum direction.
The second is the signal line, a nine-day EMA of the MACD line.
The histogram—arguably the most important component—tracks the difference between these two lines. When it moves above zero, it indicates bullish momentum; when it drops below zero, it signals bearish momentum. The slope of the histogram reflects the strength of that move.
Because it filters out short-term noise, the MACD is widely used to identify trend shifts—and right now, it’s pointing lower.
A reliable bearish pattern
Since bitcoin surged to above $126,000 in October, the MACD has shown a strong track record in identifying major turning points.
When the histogram flipped negative in early November, bitcoin’s consolidation above $100,000 quickly broke down, sending prices from around $106,000 to $80,000 within weeks.
A brief recovery followed when the indicator turned positive, but the upside proved limited. By Jan. 20, the MACD once again crossed into bearish territory with bitcoin near $90,000, triggering another sharp decline to nearly $60,000 by early February. A subsequent bounce stalled around $75,000.
So far, bullish signals have led to short-lived rallies, while bearish flips have consistently preceded deeper selloffs—suggesting that sellers remain in control of the broader trend.
Bearish signal returns
The MACD histogram has now turned negative once more, reviving the same bearish setup seen during previous declines.
While no indicator is foolproof, the consistency of this signal in recent months makes it difficult to ignore. Even as bitcoin showed resilience during the Iran war, the latest momentum shift suggests that downside risks may be building again.
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