Bitcoin ‘Golden Cross’ Appears in Price Charts, Confirming Bullish Trend

Bitcoin has formed a “golden cross” on its daily price chart, a rare but closely tracked pattern that generally occurs when an asset is on the upswing.

The golden cross is a momentum indicator, defined as the point at which the 50-day moving price average crosses above the 200-day moving average. It’s a sign that the short-term price trend is rising faster than the long-term trend.

The appearance of the golden cross marks a dramatic comeback for bitcoin since a “death cross” appeared in the price chart three months ago. At the time, bitcoin was descending from the all-time high near $65,000 reached in February. A few days after the death cross, the price fell to $28,600, close to its 2021 low. The death cross is when the 50-day moving average falls below the 200-day moving average.

The golden cross is generally regarded as a “positive” indicator,” investment research firm Fundstrat wrote Wednesday in a note to subscribers.

It’s worth noting that the indicator’s predictive power for future trends is limited.

James Butterfill, an investment strategist at CoinShares, warned in a LinkedIn post that traders should be “cautious” when pundits refer to the golden cross pattern as a bullish technical signal. The indicator “hasn’t been a consistent predictor of positive returns.”

That said, bitcoin was changing hands at around $9,500 in May 2020, the last time a golden cross appeared. Over the remainder of the year, the price tripled, and then doubled again early this year before peaking.