The post What Will Happen if Bitcoin Repeats History? Golden Cross: a Boon or Bane? appeared first on Coinpedia Fintech News
With the latest gain, Bitcoin is likely to encounter its seventh “golden cross” in the past ten years, having risen more than 40% since the year’s beginning.
A “golden cross” pattern is expected this month, according to the daily period Bitcoin price chart. The 50-day SMA (blue) will cross over the 200-day SMA (red), resulting in a cross on the price chart. This is when the golden cross will happen. Although this typically denotes a positive market, historically speaking, not all Bitcoin price increases have followed golden crosses.
When the price of a security crosses its 50-day and 200-day simple moving averages (SMAs) on the price chart, this is known as a “golden cross.” Moving averages are indicators that look in the past, thus the signal simply informs us that the market’s recent advances have outpaced its historical increases.
Nevertheless, traders and chart analysts view it as a sign of long-term price increases. The last time a golden cross was observed for Bitcoin was in September 2021, when it resulted in a 135% increase in value. However, the one in May 2020 was much more substantial.
The 50-Day SMA of Bitcoin, the largest cryptocurrency in the world by market capitalization, should pass the 200-Day SMA in about a week, assuming there isn’t a sudden and prolonged decline of more than 30% in price.
Bitcoin’s value increased in 2019 as a consequence of one of the consequential golden crossings, which occurred when the asset was trading at around $5,000. As a result of the rise, Bitcoin reached an all-time high in 2021 of approximately $69,000.
All things considered, the approaching golden cross pattern is a bullish sign for the cryptocurrency market and might predict a promising future for Bitcoin. While keeping in mind that other technical indications lean to short-term bearishness, it will be interesting to see if it indicates a sustainable rally.
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