Bitcoin’s momentum indicator is sending a warning signal for bulls

A closely watched momentum signal that has repeatedly flagged bitcoin selloffs since late last year has turned bearish once again.

Bitcoin traders may want to tread carefully. The moving average convergence divergence (MACD) histogram—an indicator that has shown notable accuracy since bitcoin’s October peak—has just slipped below zero for the third time, signaling a renewed loss of upward momentum.

How the MACD works

The MACD is built using two key components. The first is the MACD line, derived by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA, offering a snapshot of momentum.

The second is the signal line, a nine-day EMA of the MACD line itself.

However, the most telling element is the histogram, which measures the gap between the MACD and signal lines. When the histogram is positive, momentum is considered bullish; when it turns negative—as it has now—it reflects bearish momentum. The steeper the move, the stronger the shift in trend.

This indicator is widely used because it filters out short-term noise and highlights underlying momentum changes. At present, it is pointing decisively to the downside.

A track record of calling selloffs

Since bitcoin’s peak above $126,000 in October, the MACD has been strikingly consistent. Each bearish crossover has preceded sharp declines, while bullish signals have led only to brief and limited recoveries.

In early November, when the histogram turned negative, bitcoin’s consolidation above $100,000 quickly unraveled. Prices fell from around $106,000 to $80,000 within weeks.

A short-lived rebound followed as the indicator flipped positive, but momentum failed to sustain. By Jan. 20, with bitcoin near $90,000, the MACD turned negative again—triggering another steep drop to nearly $60,000 by early February. The subsequent recovery stalled near $75,000.

So far, bullish signals have produced only weak rallies, while bearish turns have consistently led to deeper declines. The pattern suggests sellers remain firmly in control, overpowering attempts by bulls to regain traction.

Another warning signal

Now, with the MACD histogram back below zero, the same bearish setup is re-emerging.

While past performance does not guarantee future outcomes, the indicator’s recent track record makes it difficult to ignore. Despite bitcoin’s relative resilience during the Iran war, the latest signal suggests that downside risks may once again be building.