Bitcoin Price Surpasses $70,000, Triggers Golden Cross Signal
Bitcoin's price has surpassed $70,000 per coin. A recent rally has triggered a "Golden Cross," where the 50-day moving average crosses above the 200-day moving average, indicating a potential price uptrend. This signal has appeared twice since the bear market bottom and historically produced significant outcomes.
Bitcoin Daily Golden Cross: 50-Day And 200-Day Moving Averages
The chart shows a daily golden cross for BTCUSD. In technical analysis, this occurs when a short-term moving average crosses above a long-term moving average, often signaling an upward price trend. The opposite, known as a death cross, occurred in August 2024 but did not lead to a prolonged downtrend, raising questions about the sustainability of the current golden cross.
BTCUSD Golden Cross And Death Cross Recent History
Since the bear market low in November 2022, BTCUSD rose from approximately $16,000 to $23,000, triggering the first golden cross of 2023. This led to an increase to around $32,000 before a decline to $25,000 caused a death cross. Following sideways movement, another golden cross occurred, resulting in a subsequent price doubling.
The current golden cross in October 2024 follows a similar pattern as previous signals, suggesting a potential rally that could push Bitcoin to $140,000.
Buy And Hold: Using Moving Average Crosses As A Trading System
Employing the 50-day and 200-day moving averages as a trading system since 2018 would have resulted in substantial profits. The initial golden cross occurred in April 2019 at around $5,000 per BTC, with subsequent trades yielding significant profits before closing out with the next death cross in June 2021 at about $35,000 per BTC.
Throughout six trades using this strategy, approximately $58,500 could have been earned as Bitcoin increased from around $5,000 to $74,000, achieving profitability in four out of six trades while minimizing losses.
Tony Severino, CMT is the author of the CoinChartist (VIP) newsletter. Content is educational and should not be considered investment advice.