The Bitcoin (CRYPTO: BTC) price has slipped again over the past 24 hours, down 1.2%. Bitcoin is currently trading for US$51,826 (AU$68,192) having dropped as low as US$50,662 earlier in the day (or night, depending on time zones).
There's been plenty of trading going on, with data from CoinDesk showing US$63.86 billion worth of Bitcoin has changed virtual hands in the past 24 hours.
But with the Bitcoin price now down 16% from its 14 March record high of US$61,557, crypto investors are asking themselves whether the digital token flew too high too fast.
Did the Bitcoin price fly too close to the sun?
You may recall the ancient Greek story of the inventor Daedalus. He's the one who constructed wings from feathers and wax so he and his son Icarus could flee the island of Crete. The problem with wax, of course, is that it's prone to melting. Hence Daedalus' painstaking instructions to his son not to fly too close to the sun.
Well, like any good teenager, Icarus ignored his dad's advice. Thrilling in soaring ever higher, the sun's heat eventually melted the wax holding the feathers to his wings. And Icarus plunged ever lower before drowning in the sea.
Yes, the ancient Greeks were full of uplifting stories.
But if you'll forgive the stretched analogy, more analysts are saying they're concerned that the meteoric rise in the Bitcoin price could lead to a meltdown of its own. Even with the 16% retracement from its record high, the Bitcoin price is still up 675% in the past 12 months.
Indeed, despite Elon Musk announcing Tesla Inc (NASDAQ: TSLA) will accept Bitcoin – and hold onto it – for its electric vehicles this week, Bitcoin's price continues to slide.
Bitcoin in a downtrend
Yesterday the Bitcoin price temporarily dropped below its 50-day moving average. Which could be a portent of more falls to come.
As Bloomberg reports, Miller Tabak + Co. chief market strategist Matt Maley says Bitcoin's 50-day average price has "been a key support level so far this year… [A] lower-low below that level would scare a lot of momentum players."
Julius de Kempenaer, senior analyst at StockCharts.com, adds:
Shorter-term, what happened yesterday, and following through today, means the start of a new series of lower highs and lower lows, and that's categorized as a downtrend. It means that we are now in a downtrend on the daily chart and it also means that the upside is now limited.
