Bitcoin (BTC) has maintained its value below the $30,000 mark, with the asset failing to break past the key resistance level amid extended consolidation across the general market. However, Bitcoin’s technical analysis suggests that the asset might be on the road to another all-time high based on historical price movements.
In particular, pseudonymous crypto trading analyst TradingShot, in a post on TradingView on August 4, observed that the maiden cryptocurrency has just completed the third-ever golden cross pattern, a bullish price signal in the long term.
According to the analysis, the previous two instances of the pattern led to significant price rallies for Bitcoin. Once the cross occurred, the 200-day moving averages calculated on a three-day time frame (3D MA 200) turned into a crucial support level, helping sustain the uptrend.
However, it’s worth noting that the exceptional circumstances of the March 2020 coronavirus crash, which he equated to a Black Swan, caused a temporary disruption in the typical pattern.
Drawing parallels to previous cycles, the analyst emphasized that with the 3D MA50 guiding the price action, the next likely target for Bitcoin’s upward movement would be its all-time high, which was last at $69,000.
Additionally, he attributed the relatively faster attainment of the 2019 golden cross to the “Libra euphoria” and other positive fundamentals that contributed to the increased adoption of Bitcoin. Conversely, in 2020, reaching the all-time high took a little longer, taking around 100 days more than the previous cycle.
“It could be a fair estimate that Bitcoin would have reached the current ATH ($69,000) by around this time next year,” he said.
What next for Bitcoin after hitting a golden cross?
The golden cross pattern occurs when a short-term moving average crosses above a long-term moving average. In the case of Bitcoin’s recent golden cross, the price was trading above the 3D MA50 and 3D MA200, indicating a positive trend shift for the digital asset.
In general, Bitcoin’s price has experienced volatility recently, and the impact of the golden cross is seen as a sign of optimism in the asset’s price trajectory. Notably, there is a consensus regarding the possibility of Bitcoin rallying to new highs.
As reported by Finbold, a significant number of Bitcoin holders (69.2%) have no intention of selling their assets but prefer ‘Hodling.’ At the same time, the amount of Bitcoin sent to exchanges has also dropped in recent weeks.
It is anticipated that the next Bitcoin halving, slated for 2024, could trigger the commencement of a new market cycle. In the short term, Bitcoin faces threats of declining further below the $29,000 mark. A Finbold report indicated that machine learning algorithms project the asset is likely to trade at $28,000 at the end of August.
Bitcoin price analysis
By press time, Bitcoin was trading at $29,014 with minor gains of less than 0.1% in the last 24 hours.
Elsewhere, under technical analysis, as retrieved from TradingView, indicators suggest bearishness. A summary of the one-day gauges recommends a sell signal and rates 10, similar to moving averages at 9, while oscillators are neutral at 9.
In the meantime, with prevailing volatility, the market is keen on how Bitcoin will react in the short term.
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