For the first time ever, a so called “golden cross” has appeared on Bitcoin’s (BTC) weekly price chart, a sign of extremely bullish sentiment among investors.
A golden cross occurs when an asset’s 50-week simple moving average crosses over the 200-week simple moving average, indicating that prices are likely to rise in the near-term.
Traders see crossovers of moving averages as forward-looking indicators, with the “golden cross” signaling the beginning or continuation of a bull market.
The first golden cross on Bitcoin’s weekly chart comes after the largest cryptocurrency by market capitalization rose more than 70% in four months to trade at $42,500 U.S.
While Bitcoin has achieved daily golden crosses in the past, the indicator has never shown up on the digital asset’s weekly chart until now.
Analysts say the latest golden cross is a sign that the rally in Bitcoin is likely to continue in 2024, especially after a series of new spot Bitcoin exchange-traded funds (ETFS) have been launched in the U.S.
The weekly golden cross also comes after the price of Bitcoin has pulled back from a peak of $49,000 U.S. reached just before the spot ETFs began trading on Jan. 11.
Some analysts say that the recent pullback in Bitcoin’s price is a temporary move and due to profit taking on the part of some investors.
Analysts at JPMorgan Chase (JPM) say that the new Bitcoin ETFs could attract $36 billion U.S. of capital from investors in the coming year, further raising the price of the crypto.
