- Short-term 50-period moving average Bitcoin is edging closer towards the long-term 100-period moving average on the weekly chart, indicating a potential bullish “golden cross” formation for the first time in 3.5 years.
- In the short term, however, the total weekly volume has fallen time-to-time as doubts continued to grip the market.
- The price action was caught between an average of 100 days and 200 day moving average (MA). The next major step how well the possibility to determine the trend of forward bias, if a firm close above or below the average were confirmed.
Bitcoin (BTC) looks on track to generate long-term bullish signal is not seen in 3.5 years.
50-period and 100-period MA has been inching closer together on the weekly chart after BTC recovering from $ 7,293 to $ 10,350 on October 26, according to data Bitstamp.
A cross of the 50-period moving slower rise above the 100-period MA MA, known as a golden cross, generally hint at a strong shift in trend and can act as a confirmation of a bullish bias for the long-term view.
Bull Last time traffic occurs on the weekly chart is way back in May 2016, when the price of BTC started to rise from $ 438 to near $ 20,000 in December 2017 – an increase of 4,800 percent. If the Supreme Court continues to converge for the moment, seen cross the possibility in late December or early 2020, but it is still too early to call right.
There are inherent risks involved with making a comparison like that of previous years, as market conditions have changed significantly. But there are benefits to look for additional confirmation of the long-term trend, because miners reward halving BTC in May 2020 tends to evoke a group of market activity as the event approaches cutting supply.
Total weekly volume has shrunk from two weeks ago, an indication of market doubts on the price fairly stagnant, while the RSI is almost the bullish trend above 52.7 (neutral being 50).
However, should the two lines converge and then cross bullish, which would be a strong indication that the 2019 reversal of the rally has legs. With strong fundamentals event for BTC happen right around the corner, it is important to note the bullish signal at a larger time frame.
More immediately, the daily chart shows the balance of the market, as prices have mostly been stuck in a range of $ 650 for almost two weeks.
BTC price action has been trapped between the 100-day and 200-day MA for 12 days.
In general, when the price is above the 200-day MA, long-term trends can be considered bullish. Conversely, if the price is below the 100-day MA then it is an indication of medium term (30-60 days) bearish condition.
The current scenario highlights the firm sentiment felt throughout the market. Repeated failure to close above the 100-day MA could open the door to $ 8,800 in the immediate short term, as discussed earlier.
Indecision will continue until a firm close above $ 9573 (100-day) or below $ 9180 (200-day MA) occurs with confidence, until then, followed the side began to be expected.
Disclosure: The author does not hold cryptocurrency assets at time of writing.
Bitcoin image via Shutterstock; charts by TradingView