Bitcoin's golden cross and the inevitable correction
A closer look at Bitcoin's recent price action
Bitcoin's Potential Soars Towards $150K; However, a Temporary Drop Might Be Imminent: Insights Provided
Table of Contents
- The golden cross and its historical impact
- Current support levels and potential breakouts
- Technical analysis: Mixed signals, but a bullish outlook
The golden cross in Bitcoin: a prelude to a mini-dip
Recently, Bitcoin (BTC) experienced a bullish technical event known as the Golden Cross. This event happens when the 50-day moving average surpasses the 200-day average, typically a strong bullish signal.
However, not everyone is rejoicing just yet. According to BTC analyst Cyclop, history suggests that a correction is par for the course after such a bullish event. Usually, Bitcoin drops by around 10% shortly after the Golden Cross before experiencing a strong rally to new highs.
This pattern acts as a "cleanout phase," allowing the market to shake out weak hands before the real breakout occurs. In February 2021 and March 2024, Bitcoin followed a similar trajectory, with a price dip shortly after the Golden Cross followed by a sharp recovery.
The recent fall of around 8% BTC witnessed coincides with the expected pullback, and market sentiment is generally cautious but optimistic, with most analysts expecting a rebound sooner rather than later.
Support levels and potential breakouts
Currently, Bitcoin is trading at roughly $105,000, and it seems the support around this level is holding strong. If the price manages to break above the resistance at $106,673, this could reignite bullish momentum and potentially initiate the next leg up.
However, if the price slips below the support at $102,268, a deeper correction may follow. It's important to note that long-term holders of BTC, ETH, and SOL remain confident in the robustness of these assets and are now eyeing selected altcoins with strong fundamentals.
Technical analysis: Mixed signals, but a bullish outlook
From a technical standpoint, Bitcoin's daily chart on TradingView suggests consolidation after the recent rally. The price currently sits at $105,380.6, slightly above the lower Bollinger Band, which indicates short-term support.
The RSI (Relative Strength Index) sits at 53.44, which signifies neutral momentum, and there are no extreme conditions in sight. However, the MACD (Moving Average Convergence Divergence) shows weakening bullish pressure, with the line slipping below the signal, and negative histogram bars.
Despite this, flattening historical levels hint at a slowing selling trend. The volume remains muted, indicating market indecision and a possible pause in trend direction.
In summary, despite the recent correction and mixed signals, the overall trend remains bullish for Bitcoin in the long term. Analysts believe it's only a matter of time before BTC reclaims its upward trajectory, potentially even skyrocketing towards $150,000 in the near future.
Enrichment Data:
The Golden Cross is often followed by a short-term decline before a more substantial rally, which acts as a "cleanout phase," shaking out weak holders before a stronger breakout occurs. This is reflected in historical trends, as seen in the February 2021 and March 2024 trading periods (enrichment data 1).
Currency price fluctuations are often influenced by market sentiment and technical signals. In this case, the current consolidation, the mixed signals from technical indicators like the RSI and MACD, and BTC's resistance at $106,673 and support at $105,000 suggest an ongoing battle between bullish and bearish sentiments. Nevertheless, most analysts remain confident in the long-term prospects for Bitcoin and other top cryptocurrencies. (enrichment data 2)
- Despite the recent 8% decline in Bitcoin's price after the Golden Cross, many analysts anticipate a rebound, with optimistic long-term views about Bitcoin's potential rise towards $150,000.
- Investors should also consider Ethereum (ETH) as a potential investment, given its strong fundamentals, since long-term holders of both BTC and ETH remain confident about the robustness of these assets.
