As 2025 concluded, Bitcoin (BTC) wrapped up on a downward trend, trading over 30% below its peak values and facing the emergence of a death cross—a technical signal often linked to major price declines.
Currently just above $89,200, Bitcoin recently witnessed its 10-week and 50-week simple moving averages (SMAs) intersect on December 8, a development highlighted by market analyst Ali Martinez on social media platform X (formerly Twitter).
Bitcoin Could Encounter 50%-60% Correction
Martinez stressed the necessity of monitoring the behavior of these two moving averages on the weekly chart. Historically, every time Bitcoin has experienced a death cross between the 10-week and 50-week SMAs, it has been followed by significant corrections.
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As illustrated in the cryptocurrency’s weekly chart below, previous instances of such crossovers have resulted in price drops of 67% in September 2014, 54% in June 2018, 53% in March 2020, and 64% in January 2022.
With the recent death cross in play, Martinez warns that if history holds true, Bitcoin might face a correction ranging from 50% to 60%, potentially bringing its price down to between $50,000 and $38,000.
Adding more layers of complexity to the situation, market expert Mags has laid out two possible scenarios for Bitcoin’s immediate future.
Two Scenarios for BTC’s Path Ahead
After Bitcoin’s decline from its October highs above $126,000, it has been trading around the $85,000 range for a few weeks. Meanwhile, Tether’s USDT dominance has broken free from its prior range, currently staying above the breakout threshold.
Given the inverse relationship between Bitcoin and USDT dominance, Mags has identified two primary scenarios moving forward. The first, a bullish outlook, relies on the idea that a decline in USDT dominance could signal that the current breakout is a false one.
Mags believes that such a shift could potentially trigger a new upward trend in Bitcoin’s price, maybe even reaching a new all-time high prior to any considerable distribution.
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On the other hand, Mags has highlighted a second scenario suggesting initial signs of a bearish structure. Should the broader market trend weaken, Bitcoin may see a brief rebound, while USDT dominance forms a higher low near its mid-range before rising again.
In this situation, BTC would display a sluggish distribution trend, characterized by neither a crash nor a swift drop, but rather a slow, choppy decline typical of an early bearish market.
The forthcoming movement in USDT dominance is likely to play a crucial role in determining whether the current market is merely a pause before further price action or the beginning of an extended distribution phase leading to a new all-time high.
Featured image from DALL-E, chart from TradingView.com
