In this month of May 2026 the price of Bitcoin has in fact returned to the 200-day moving average.
The problem is that this average has been falling for five months, and shows no signs of reversal.
This leads some analysts to argue that the decline in the price of Bitcoin could continue precisely by following that of the 200-day moving average.
The 200-day moving average
The simple 200-day moving average (SMA200) has become one of the most closely watched technical indicators for those who analyze price trends on financial markets.
However, it was identified as a reference point many years ago, well before cryptocurrencies were created.
The fact is that traditional stock exchanges have about 250 trading days a year, because they are closed on weekends and holidays. Instead, the crypto market is always open, 365 days a year.
200 days is a convenient proxy for “almost a year” of prices on traditional exchanges, and it is used to eliminate short-term noise and show the structural trend of an asset’s price. The SMA200 is slow enough to filter out daily volatility, but reactive enough to capture genuine regime changes, such as those between bull markets and bear markets.
Moreover, banks, hedge funds, algorithms and retail traders watch it, so that for example when a price falls below the SMA200 many operators interpret it as a possible sell signal.
However, it is in fact a coordinated convention, and not an economic/financial law.
The crypto market
Applying the SMA200 to crypto assets can make sense, but only as long as the SMA365, that is the average price of the last year, is not underestimated.
For example, while Bitcoin’s 200-day average has been clearly falling since November 2025, the 365-day average from November to January 2026 was almost flat, and the subsequent decline appears to be only slight.
Bitcoin’s SMA200 reached a peak in mid-November 2025 above $110,000, while the SMA365 was below $103,000.
At the end of January the SMA200 had already fallen to $104,000, while the SMA365 was still at $101,000.
Since then the 200-day average has collapsed below $81,000, while the 365-day average has remained above $95,000.
They are therefore two different parameters that tell two different stories, but they are not alternatives to each other: they are complementary and it would be advisable to use both.
The problem
Recently, while the 200-day SMA was falling to $82,000, the price of Bitcoin was rising to $82,000.
On May 14, that is last Thursday, the connection occurred, but as soon as BTC returned to the 200-day average its price immediately fell.
Since then the SMA200 has fallen further, below $81,000, and so has the price of Bitcoin.
The fact is that the 200-day average has now been constantly falling for five months, and for now no sign of a possible trend reversal emerges from the chart.
At this rate, in a few days a situation similar to that of May 14 could occur again, and in that case the market reaction could also be the same.
That is, if in the coming days the price of Bitcoin, which is currently 3.8% below the 200-day average, were to rise again to reconnect with it, the markets could once again react with significant selling capable of making it bounce back the other way, and therefore fall.
The exception
However, by analyzing past bear markets, similar situations are not frequently found.
For example, in April 2022 the price of Bitcoin rose to touch the 200-day average, but only to then continue to fall for the rest of the bear market, remaining well below it. It only returned to it in January 2023.
Moreover, the SMA200 only started to fall in April itself.
In 2018 the connection occurred in May, but with the SMA200 even still rising. Its decline began in June, and in July there was a second connection, followed however by a period of sideways movement after the bounce in the opposite direction.
So up to now there have never been two bear markets in which the comparison between the trend of Bitcoin’s price and that of its 200-day average has been similar, except for the fact that both were falling.
The weakness
All this leads to the conclusion that the comparison with the SMA200 cannot be used to make forecasts.
It can instead be used to get an idea of how markets might react in the short term, and above all to make comparisons with the past and assess, for example, the weakness of the recent phase.
What emerges from such comparisons is that the current situation shows decidedly more weakness than previous bear markets, but using the SMA365 instead, the situation does not seem at all weaker than in the past.
For example, in 2018 the 200-day average fell below the 365-day average in August, that is a few months after the previous peak. In 2022 this crossover even occurred in May, just one month after the peak.
This time instead it occurred in February, three months after the peak. The situation is therefore different, and only in some respects worse.
