Bitcoin is entering into a Crash

The Bank of America Merrill Lynch has compared the bubble burst incidents such as Bitcoin and Tulip Bubble, Nanhai Company Bubble, and the Great Depression and found that bitcoin has entered the collapse period. Compared with the highest point, Bitcoin has fallen about 2/3 and is approaching "death crossing."

Bitcoin prices have fallen significantly since the end of last year to nearly 20,000 U.S. dollars, and bitcoin has fallen by 65% ​​compared with the highest point. The future of Bitcoin prices will go up again or will continue to fall?

According to the Bank of America Merrill Lynch, that is the biggest bubble in history, Bitcoin is entering a period of collapse similar to the famous economic bubble in the history of Tulip Bubble and Nanhai Company Bubble.

In a research report on Sunday, Michael Hartnett, chief investment strategist of the Bank of America Merrill Lynch, pointed out that Bitcoin is repeating the same mistakes as those inflows of assets that historically were influxed but later collapsed.

Picture from Bank of America Merrill Lynch

However, Wall Street news also mentioned that recently well-known families such as the Rockefeller, Soros, and Rothschild are investing in digital currencies such as Bitcoin .

On Monday, after the Rockefeller family’s risk investment fund spread news about Bitcoin, Bitcoin once returned above $7,000. However, it fell to around 6,700 U.S. dollars.

Wall Street's information has mentioned that the performance of the entire digital currency market in the first quarter was the worst in history, with bitcoin approaching the first quarter and falling below the 200-day on average.

At the end of March, Bitcoin once again approached the death cross.

The so-called "death crossing" refers to the short-term moving average level of assets is lower than the long-term level, and from a technical point of view, this often means that the asset is further downtrend. More specifically, the 50-day moving average of assets is lower than the 200-day moving average.

Jim Iuorio, an analyst at TJM Institutional Services, said in an interview with CNBC:

When we talk about Bitcoin, I think it's very important to realize that this asset has not been born for a long time and it is difficult for us to get its long-term trend line. In other words, any intersection between the 50-day moving average and the 200-day moving average is a clear warning. What's more, Bitcoin futures are already listed, which means that Bitcoin may be more inclined to stabilize at a low level. This is bad news for Bitcoin.

However, there are also people from a technical point of view that the status of Bitcoin is not so bad.

Brian Kelly, a trader at Fast Money, believes that since August last year, the rising trend of Bitcoin has not changed:

Just like the foreign exchange market, the bitcoin market and technical analysis are closer, and the support line is actually more important. If the support line can continue to play a supporting role, the upward trend since August last year has not actually changed.

Forbes columnist Frank Holmes said that as with financial assets such as the US stock market, bitcoin will inevitably have a strong recovery after a major downturn.