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HomeBitcoinBitcoin Witnesses First-Ever Weekly 'Golden Cross,' a Bullish Signal for Some
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Bitcoin Witnesses First-Ever Weekly ‘Golden Cross,’ a Bullish Signal for Some

Bitcoin (BTC) has experienced its first-ever weekly “golden cross,” as the 50-week simple moving average (SMA) crossed above the 200-week SMA on the weekly price chart. A “golden cross” is considered by market enthusiasts as a bullish signal, suggesting a positive shift in asset prices.

The golden cross and its counterpart, the “death cross,” where the short-duration SMA falls below the long-duration SMA, originated in Japan and are often used as technical indicators in market analysis. Traders often view crossovers as forward-looking signals, with the golden cross indicating the potential for a long-term bull market.

However, some traders caution against relying too heavily on crossovers as predictive indicators, as they are based on historical data and tend to lag behind actual price movements. Averages reflect past performance, and the first golden cross on the weekly Bitcoin chart is a result of the cryptocurrency’s rally of over 70% to $42,700 in just four months.

Experienced traders often consider crossovers as lagging indicators, coinciding with trend exhaustion. For example, the weekly death cross confirmed in early 2023 marked the bottom of the bear market. The historical performance of Bitcoin’s daily chart golden and death crossovers has been mixed in predicting bullish and bearish trends.

Bitcoin’s recent rally, fueled by the approval of 11 spot exchange-traded funds (ETFs) in the U.S., has encountered a slowdown, with the cryptocurrency trading 10% lower from its highs near $49,000. Observers suggest that the initial excitement surrounding ETF flows failed to meet the high market expectations, contributing to a decrease in bullish momentum.

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