Bitcoin (BTC), the most popular cryptocurrency in the world, is still strong despite the unfavorable macroeconomic situation. At the time of publication, BTC is trading 1.66% higher at $23,278 and has a $448 billion market cap.
The comments made by February Chair Jerome Powell on Tuesday and the positive US jobs data have so far encouraged the cryptocurrency market. The price of Bitcoin (BTC) has been fluctuating between $20,000 and $23,000 for some time, and analysts are split on what the potential next increase will look like.
For the first time in more than a year, a "Golden Cross" has just been confirmed on the technical chart for Bitcoin. This indicates that the 50-day Simple Moving Average (SMA) for Bitcoin has just surpassed the 200-day SMA. This chart pattern may represent a significant uptick in the market's momentum.
The BTC price rose by 154% after the Golden Cross was formed during the final bear market of 2019. If the same scenario happens again, Bitcoin might trade at a price of more than $57,000 in 2023.
The Origins of Bitcoin and Its Golden Crosses
Even though many analysts view the development of a "golden cross" as a bullish indication for the asset, their track record of success is uneven. Additionally, the outcomes change depending on how long Bitcoin was held after the "golden cross" formation.
If the investor had kept BTC for 90 days during the seven previous golden cross events, they would have made money four out of the seven times. The increase percentage can range from 10 to 80%.
However, if the investor had continued to hold BTC after the golden cross formation for 365 days, he or she would have made money five out of seven days. In this instance, the gains' sizes range from 25% to 400%.
The "golden cross" ratio does not, therefore, always ensure success, and investors should have a longer holding period.