Bitcoin (BTC) recently formed a golden cross formation. The last time the gold cross occurred in Bitcoin was on February 18, and while people were waiting for BTC / USD to jump, Bitcoin fell below $ 4,800!
Although Bitcoin occasionally enters consolidation after the split, it offers a stable view. In addition, lifeless Dow Jones and S&P 500 are pushing retail traders to invest in BTC / USD, causing a paradigm shift.
However, despite these developments, a closer look at the BTC / USD chart will show that, despite the increase in Bitcoin price after May 12, there has been a significant drop in BTC trading volume.
Bitcoin (BTC) Golden Croos Formation Is Not Encouraging!
Golden cross occurs when short term moving average such as 50-DMA passes over long-term moving average such as 200-DMA. This formation is perceived as an ascending pattern.
However, most of the time, investors forget that golden cross is not an approved bullish model. Moreover, golden cross formation should be perceived as a bullish sign when it occurs with a large trading volume.
Three Factors Showing Bitcoin (BTC) Decline
- The daily chart for BTC / USD shows the golden cross formation. When we took a look at the trading volume, the volume started to rise only after investors noticed the formation of golden cross. The MACD indicator is still neutral.
- The size of the candles is a significant concern. Although BTC is on the rise, green candles are small compared to large red candles. It is an indication that BTC / USD is not a bull market.Also, the daily price chart for BTC / USD clearly shows the formation of golden cross on February 18 and death cross on March 25. While BTC / USD started to decrease after February 18, Bitcoin gradually increased after the death cross formation on March 25.
- Therefore, hasty decisions on BTC / USD can be disastrous and investors must keep all this in mind before investing in Bitcoin.