Today in the crypto market there is talk that the Bitcoin price forms a golden cross – a potentially bullish signal according to conventional knowledge. But this is the cryptocurrency market, and given the potential for sudden, sweeping regulation, hacks, or worse, anything is possible.
With the Golden Cross here now, let’s look back at the history of the signal and decipher exactly what it means and how this could affect Bitcoin price movement in the coming days.
Bitcoin price forms the eighth ever golden cross
Forget the digital gold story. There are discussions about the cryptocurrency community everywhere on crypto twitter, online forums, and everywhere else. The discussion revolves around the golden cross that is forming on the BTCUSD trading pair.
According to Investopedia, a gold cross “occurs when a short-term moving average crosses a large long-term moving average upward”. It is “interpreted by analysts and traders as a signal for a definite upward movement in a market,” the description goes on to say. In particular, this golden cross refers to the 50-day moving average, which is above the 200-day moving average.
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Since this could be the final spike in Bitcoin price, driving the cryptocurrency to its potential cycle climax, all eyes are on the signal. But not everyone knows what to look for or what it means.
In the graphic below, the inverse signal – the Death Cross – did not bring the expected results, so it is impossible to predict whether the bullish version will also be confirmed. Looking back at the history of the two signals, the situation becomes even more mixed.
The golden cross is there | Source: BTCUSD on TradingView.com
Everything you need to know about the bullish signal
The leading cryptocurrency by market capitalization had eight golden crosses and seven death crosses in its short history, according to the Bitstamp chart.
The Golden Cross to start the 2013 Bull Market only crossed Death when a bear market finally started, but not before a quick Golden Cross / Death Cross was faked.
After the cryptocurrency hit rock bottom in 2015, another fake-out situation where the cryptocurrency was Golden Crossed, then Death Crossed, and then Golden Crossed again. The last signal brought Bitcoin from under $ 500 to $ 20,000. A death cross also started the bear market in 2018 until a golden cross brought the cryptocurrency out of the bear market’s lows.
Could this be the last bullish signal before the peak? | Source: BTCUSD on TradingView.com
In late 2019 and early 2020, the consolidation resulted in more mixed signals. It started with a death cross in October 2019, then, like the 2017 Bull Run, a gold cross was forged into a death cross, only to bring the gold cross and bitcoin back from $ 4,000 to $ 65,000. After such a move, it’s not surprising why investors are skeptical of another Golden Cross with similar results.
Bitcoin formed another death cross after the recent local high of $ 65,000, but it didn’t cause much of a disadvantage. With a gold cross back, the market is now nervous about yet another fake-out situation, but is also afraid of missing out on a potential uptrend.
Related reading | New to Bitcoin? Learn to trade crypto with the NewsBTC trading course
In the past, Bitcoin has been the underdog, climbing its way to the top in every possible way despite all odds. Today things are very different, and there are more sophisticated investors involved – including institutions, corporations, hedge funds and more.
With smart money finally getting involved in the crypto space, it might be the smarter game to follow a traditional all-in market signal like the Golden Cross.
Will Bitcoin’s golden cross ultimately …
– NEWSBTC (@newsbtc) September 15, 2021
Follow @TonySpilotroBTC on Twitter or via the TonyTradesBTC Telegram. The content is educational and should not be viewed as investment advice.
Featured image from iStockPhoto, charts from TradingView.com