Just a day before Bitcoin surpassed the psychological resistance level of $ 11,500, the cryptocurrency as a financial asset drew one of the strongest bullish signals in its eleven-year history.
On October 11, it formed a leading “Golden Cross” on the BTC / USD daily chart. The pattern occurs when the short-term moving average of the pair rises above its long-term moving average. Typically, analysts measure the ‘Cross against a transition between a 50 to 200-period moving average. However, it remains a lagging indicator.
Replacing the 50-200 transition with 20-50 gives a more accurate and real-time depiction of the market’s bias, at least in the case of Bitcoin. The last three Golden Cross formations accurately reflect this.
The first 20-50DMA transition emerged on January 5 this year, referring to GC1 in the chart above. BTC / USD rose 42% while 20-DMA fluctuated above 50-DMA.
Similarly, GC2 is showing a 46% price rally after BTC / USD approved another 20-50DMA Golden Cross on April 20. The sentiment was the same in the last crossover, which took place on July 25, which raised BTC / USD by around 30%. percent.
Conversely, the Death Cross formation, the opposite of the Golden Cross, dropped the pair each time. It shows that investors are watching the 20 and 50 DMAs to decide market trends.
Associated with Large Firms
Most recently, the Golden Cross fractal emerged at a time when large firms announced their entry into the cryptocurrency market.
This Tuesday alone, Stone Ridge, a $ 10 billion asset management giant, announced that it has invested $ 115 million in Bitcoin. The firm has gone so far as to develop their own customized solutions for surveillance so they can direct their customers to invest in Bitcoin. The news comes days after Square, a multinational payments company headed by Jack Dorsey, showed about $ 50 million worth of Bitcoin on its balance sheets. The company even published a technical report for companies. In this report, they explained how they can invest in the best performing financial asset of the decade.