A key technical indicator that has historically preceded the final capitulation phase of Bitcoin bear markets is flashing again. Chartist Ali Martinez warns that a 'death cross' on Bitcoin's three-day chart could be confirmed in late February. This pattern, formed when the 50-day simple moving average crosses below the 200-day average, has reliably signaled major downside moves since 2014.
Martinez's analysis of historical data shows that following the 2013 top, BTC fell over 72% before the death cross in December 2014, then dropped another 52%. After the 2017 peak, the signal in November 2018 preceded a final 50% decline. The pattern emerged again in May 2022 after the 2021 top, leading to an additional 45% drop. If history repeats, Martinez projects a further 30-50% decline from current levels, potentially sending Bitcoin to $40,000 or even $30,000.
The technical warning coincides with intense selling pressure triggered by geopolitical events. Bitcoin's price fell sharply, dropping below $64,000 after U.S. President Donald Trump announced a plan to raise global tariffs to 15%. The cryptocurrency is down approximately 5% in 24 hours and has lost nearly 27% of its value over the past month.
The tariff announcement sparked a coordinated bearish impulse in futures markets. Data from analyst Axel Adler Jr. showed taker sell volume spiked to $2.3 billion in a single hour, accompanied by forced long liquidations of approximately 1,247 BTC worth over $81 million. Total market liquidations in 24 hours reached $616 million, with $524 million being long positions.
Market sentiment has turned sharply negative. Santiment data confirms the liquidation cascade, with open interest dropping to $19.5 billion—less than half its January peak—indicating the Bitcoin market has entered what analysts describe as 'FUD mode'.
Experts cite multiple factors behind the sell-off. Jeff Mei, COO of BTSE, noted the tariff increase prompted investors to sell crypto assets anticipating a broader market downturn, while increased U.S. military presence around Iran raised regional conflict risks. Markus Thielen, research director at 10x Research, emphasized that weak liquidity and low market confidence are more concerning than any single headline, characterizing the current phase as a typical bear market with low volume and uncertainty. Thielen warns that downside risks persist due to upcoming U.S. midterm elections and macroeconomic uncertainties, suggesting a further pullback toward $50,000 shouldn't be ignored.
