Bitcoin (BTC) has held its value below $30,000, with the asset failing to break the key resistance level despite ongoing consolidation in the broader market. However, Bitcoin technical analysis suggests that the asset could be on track for another all-time high based on historical price action.
Notably, in a post on TradingView on Aug. 4, pseudonymous crypto trading analyst TradingShot noted that the first cryptocurrency has just completed its third-ever golden cross pattern, providing a bullish price signal over the long term.
Bitcoin price analysis chart. Source: TradingView
According to the analysis, the two previous occurrences of the pattern resulted in significant price increases for Bitcoin. Once the crossover occurred, the 200-day moving averages (3D MA 200) calculated over a 3-day timeframe turned into a crucial support level that helped sustain the uptrend.
However, it is worth noting that the extraordinary circumstances of the March 2020 coronavirus crash, which he equated to a Black Swan, caused a temporary disruption to the typical pattern.
Drawing parallels with previous cycles, the analyst stressed that the next likely target for bitcoin’s upside would be its all-time high, last seen at $69,000, as the 3D-MA50 guides the price action.
Additionally, he attributed the relatively quicker attainment of the 2019 Golden Cross to the “Libra euphoria” and other positive fundamentals that contributed to the increasing adoption of Bitcoin. Conversely, reaching the all-time high in 2020 took a little longer, lasting around 100 days longer than the previous cycle.
“It might be a fair estimate that Bitcoin would have reached the current ATH ($69,000) by around this time next year,” he said.
What’s Next for Bitcoin After It Hits a Gold Cross?
The Golden Cross pattern forms when a short-term moving average crosses a long-term moving average. In the case of Bitcoin’s recent golden cross, the price was above the 3D-MA50 and 3D-MA200, indicating a positive trend reversal for the digital asset.
In general, Bitcoin’s price has been subject to volatility lately, and the impact of the Golden Cross is taken as a sign of optimism about the asset’s price development. In particular, there is a consensus that Bitcoin may make new highs.
As Finbold reports, a significant number of Bitcoin holders (69.2%) have no intention of selling their assets, preferring instead to “hodle”. At the same time, the amount of bitcoins sent to exchanges has also decreased in recent weeks.
The next bitcoin halving, scheduled for 2024, is expected to trigger the start of a new market cycle. In the short term, Bitcoin is at risk of falling further below $29,000. According to a Finbold report, the asset is expected to trade at $28,000 by the end of August, according to machine learning algorithms.
Bitcoin price analysis
At press time, Bitcoin was trading at $29,014 with marginal gains of less than 0.1% over the past 24 hours.
Bitcoin seven day price chart. Source: Finbold
Elsewhere, technical analysis indicators as pulled from TradingView are pointing to a bear market. A summary of the one-day indicators recommends a sell signal and reports a reading of 10, similar to the moving averages at 9, while the oscillators are neutral at 9.
Technical Bitcoin Analysis. Source: TradingView
In the meantime, given the prevailing volatility, the market is eager to see how Bitcoin will react in the near term.
Disclaimer: The content of this website should not be construed as investment advice. Investing is speculative. When you invest, your capital is at risk.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.