In a recently published video, Alessio Rastani, a renowned market analyst, provided an in-depth examination of Bitcoin’s current price trends. Rastani referred to the ‘Kiss of Death’ signal, a term used in technical analysis to indicate a potential bearish trend reversal. He previously discussed this concept in relation to Bitcoin’s price actions, hence revisiting it to give viewers an update.
Rastani explained that the ‘Kiss of Death’ pattern unfolds in three distinct steps: an uptrend to all-time highs, followed by a drop and closure below the 21-monthly exponential moving average (EMA), and then a bounce back towards the 21 EMA. After this, if the price collapses and drops below previous lows before the bounce, it would trigger the ‘Kiss of Death’, typically signaling the onset of a long-term bear market.
Rastani used the long-term monthly chart of Bitcoin for his analysis. He noted that in 2021, Bitcoin hit the $69,000 mark and then dropped below the 21-month EMA, essentially fulfilling two out of three criteria for the ‘Kiss of Death’ signal. However, as Bitcoin hasn’t taken out the lows made before the bounce, Rastani confirmed that we have not yet seen a ‘Kiss of Death’ signal.
To determine whether Bitcoin is likely to trigger the ‘Kiss of Death’, Rastani argued that if Bitcoin’s price goes below the region between $19,500 (March lows) and $15,460 (November lows), it could potentially confirm the ‘Kiss of Death’ signal and push the market into a bearish scenario. He also stated that even if Bitcoin takes out the March lows, it could increase the likelihood of a bear market.
However, Rastani also pointed out that he doesn’t believe this bearish scenario is likely, maintaining his bullish perspective on Bitcoin. He suggested that Bitcoin is likely to rally and take out its prior high near $30,000-$31,000 in the next few weeks or months. If that happens, it would negate the ‘Kiss of Death’ hypothesis and signal a strong long-term bull market.
Although Rastani acknowledges the possibility of a ‘Kiss of Death’ scenario, he believes it’s less probable based on his analysis. He emphasized that there are no certainties in any market, and while Bitcoin has an opportunity to prove its potential bearishness, he remains in the bullish camp for Bitcoin’s outlook this year.