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Scott Melker discusses bitcoin‘s (BTC-USD) potential golden cross and what the bullish technical signal could mean for the cryptocurrency‘s chances of entering a new bull run.
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Uh, the first story is one that might be a little bit noisy, but I think it gives us a bit more information on what’s likely coming for Bitcoin. It is this one right here. Bitcoin’s fabled golden cross is coming.
And USDT may be the real signal this time. So for those of you who don’t know, a golden cross is when the 50 moving average crosses up above the 200 moving average or anytime a shorter time frame moving average
crosses above a longer time frame moving average. Now, listen, these are lagging indicators, moving averages tell you what happened in the past, not necessarily what’s coming in the future. But in the case of Bitcoin on the daily chart, they have been somewhat reliable. They’ve produced 12 golden crosses since 2012 on the Bitcoin chart.
The nine with measurable three-month returns produced an average gain of approximately 24.9%. Now, once again, in a vacuum, I don’t think this is a particularly important story.
But when you add it to the months of data of me telling you that I think Bitcoin is likely bottoming and all of the signals compounding, this is yet another piece of evidence that the Bitcoin bear market bottom is likely in.
So, to be fair, the the only three of those nine that I talked about remained intact for an entire year. So it’s a confirmation of momentum, not a guarantee that we go all the way to new all-time highs. Once again, take all these with a grain of salt.
But it’s another piece of evidence. and meanwhile, as you saw in that article, USDT dominance has also been dropping. It is approaching a death cross, which is the opposite when a short-term moving average goes down below a long-term moving average.
That I don’t care about very much, but the very idea that USDT dominance is dropping is an important signal, but it because it means that people are exiting their stable coins to go risk on and buy more crypto assets. USDT dominance dropping while USDT actually grows is a major signal of where people are putting their money in the crypto market. And right now that is back into tokens and into the market
itself. So that is what is absolutely important uh, important here.
Source: finance.yahoo.com