A trader wears a Bitcoin shirt while working in the S&P 500 options pit at Cboe Global Markets Inc. in Chicago, Illinois, U.S. (Photographer: Daniel Acker/Bloomberg)

Bitcoin’s Meltdown Looks to Grow Worse Before Things Get Better

(Bloomberg) -- If you think that Bitcoin has hit bottom after the latest round of violent price drops, think again.

While the world’s largest cryptocurrency is down 65 percent since its peak in December, technical indicators suggest there’s worse to come. Bitcoin has consistently had lower peaks since its apex in December, with each new high lower than the last. In addition, the Directional Movement Index signals the bullish buying pressure came to an abrupt end, and a new selling pressure trend has started.

Bitcoin’s Meltdown Looks to Grow Worse Before Things Get Better

The trend may explain increased hesitance by institutional investors to get involved. Goldman Sachs Group Inc. is pulling back on near-term plans to set up a crypto trading desk, according to reports.

Many investors have already gotten burned, and more could still do so. Crypto hedge funds are down by nearly 50 percent so far this year, according to the Eurekahedge Crypto-Currency Hedge Fund Index.

©2018 Bloomberg L.P.