U.Today – An extremely rare pattern has formed on the BTC price chart as the intersection of the 100 and 200 moving averages has created a golden cross on the chart. More importantly, this is the first such golden cross for a major cryptocurrency.
It is worth noting that when the 100-day and 200-day moving averages cross, it is a significant event. These moving averages are key indicators that traders use to assess long-term trends.
The 100-day moving average shows the average closing price of Bitcoin over the past 100 days, while the 200-day moving average does the same over the past 200 days. When the shorter time frame crosses the longer time frame, a golden cross is formed, which is generally considered a bullish signal.
The golden cross indicates that Bitcoin price momentum may be shifting upwards. This is because the short-term trend is now outperforming the long-term trend. This pattern is often considered a precursor to prolonged upward price movements. This is because it indicates growing market confidence and increasing demand for the asset.
But, there is a but
However, it is worth noting that these moving averages previously formed a death cross when the long-term moving average crossed the short-term moving average. After this death cross was completed, the price of Bitcoin soared by over 100% to a new all-time high of $74,000.
This means that if this golden cross does materialize, we may not see a rise in the price of Bitcoin, but rather a further drop.
While the golden cross is a positive indicator, it is important to note that technical analysis is not foolproof. Other factors, such as macroeconomic conditions, regulatory changes, and investor sentiment, can also influence the price of Bitcoin.
This article was originally published on U.Today
