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Bitcoin (BTC) has just posted its first golden cross since September 2021. VentureFounder, a crypto trader that provides analysis on Cryptoquant, tweeted excitedly about the event.
According to the analyst, a potential correction in a bearish scenario might see BTC retest $20K, while on the other hand, in a bullish case, Bitcoin might test $25K next. Once the $25K barrier is flipped into support, "it's the nail in the coffin for the bears."
#Bitcoin goldencross just happened!
— venturefoundΞr (@venturefounder) February 6, 2023
This potential correction could see #BTC retest $20k (#200DMA and key support), then in the bullish case, test $25k next.
Make $25k support and it's nail in the coffin for the bears. pic.twitter.com/baPFOTECCG
When the moving average (MA) 50 crosses above the MA 200, a positive crossover, or "golden cross," appears on the price chart.
Eight golden crosses have occurred in the history of Bitcoin, three of which — in February 2012, October 2015 and May 2020 — predicted price increases of between 100% and 350%.
On the other hand, the lead cryptocurrency dropped after the golden crosses of July 2014, July 2015 and February 2020, which were bull traps. Since moving averages are lagging indicators, the majority of the gains may have already happened before the crossover.
Nevertheless, traders and chart analysts view the golden cross as a sign of long-term price increases.
Indicators are mixed
In a day or two, Bitcoin appears to be on course to make another crossing on its weekly chart. This time, it appears to be a death cross, which is the opposite of a golden cross and denotes a bearish change in the long-term trend.
On the other hand, the Federal Reserve's stance, which is becoming less aggressive as the days go by, might imply positivity for the lead cryptocurrency. At the time of writing, the price of Bitcoin had increased slightly over the previous day to $22,964.
Tomiwabold OlajideOn Tuesday, Fed speakers, including Chairman Jerome Powell, are due to make remarks. Investors will be keeping an eye on the data front as the corporate earnings season continues and the December balance of trade report is released on Tuesday.
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