Since the extreme hype in 2017, Bitcoin has become relatively quiet, but that could change suddenly. Because currently a very meaningful signal from the charts indicates a new rally.
• BTC-USD is training the Golden Cross
• GD50 exceeds GD200
• Experts expect a price rally
With a bitcoin exchange rate of just under $ 9,000, the world’s most popular cryptocurrency is currently trading at a relatively high level. Bitcoin has gained more than 30 percent in value since the start of 2020 and now brings it back to a market capitalization of around $ 160 billion with a total of 18.2 million mined coins.
The Golden Cross – probably the most popular trend indicator
Now the signs are good that Bitcoin can sustainably regain the $ 10,000 mark in the coming days. This is supported by at least one indicator from chart technology, which has proven itself many times in the past. This very special constellation should be the favorite formation of every Bitcoin bull, as it usually initiates an upcoming rally.
This rally-harbinger formation is called the Golden Cross. A golden cross in chart technology arises whenever the GD50, i.e. the medium-term 50-day line, crosses the long-term GD200, i.e. the long-term 200-day line, from bottom to top. This formation can indicate a new upward trend very early on, since the GD50 is very sensitive to price changes compared to the GD200. The forecast value of this formation is very meaningful, which can also be shown in back tests. In contrast to its counterpart, the death cross, it is important for the Golden Cross that the GD50 crosses the GD200 from bottom to top and not vice versa.
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Bitcoin bull with mega price target
The constellation of the Golden Cross already appeared on the BTC-USD chart on February 18 and is now causing new optimism among crypto speculators. Bitcoin bull Tom Lee from Fundstrat is firmly convinced that Bitcoin can rise to $ 27,000 by August. Lee therefore assumes that the digital thaler currently still has more than 170 percent of price potential. For analysts, the main reason for the forecast rally is of course the formation of the golden cross. “It’s a big deal, as the trend follower knows – if you’re back above the 200-day line, you’re back in the bull market,” Lee said in an interview with Yahoo Finance.
Halving positive impulse
The forecast by venture capitalist Mike Novogratz and founder of crypto bank Galaxy Digital is somewhat more conservative. The entrepreneur expects the BTC-USD pair to regain its all-time high of around $ 20,000 until the coin mining reward is halved in May 2020. This so-called “halving” is defined in the Bitcoin algorithm and always takes place after 210,000 mined blocks. This mechanism is intended to ensure that Bitcoin does not slide into inflation.
In the past, enormous price gains were recorded following a “halving”, the bitcoin climbed by over 8,000 percent in the months after the first halving in 2012. This event also resulted in a significant rally in 2016, which caused the Bitcoin price to rise by 2,000 percent after halving. While many Bitcoin fans are now hoping that such a scenario will be repeated, the miners have to prepare for a lower reward. The yield for the validation of the transaction on the blockchain drops from 12.5 to 6.25 Bitcoin.
Strong fundamentals
At the moment, however, not only the technical analysis and the “halving” speak for an increasing Bitcoin price, but also the fundamental data from the crypto network. In early February, for example, the total number of confirmed Bitcoin transactions exceeded half a billion for the first time. Furthermore, the number of daily Bitcoin transactions has been at its highest level for over five months. In addition, the hash rate, i.e. the computing power of the Bitcoin network, has been increasing for months and is now almost ten times higher than at the all-time high in December 2017. According to this multitude of positive signals, it is quite possible that the Bitcoin is now regaining momentum and targeting its old records again.
Pierre Bonnet / editorship finanzen.ch
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Image source: Gil C / Shutterstock.com, Steve Heap / Shutterstock.com, ppart / Shutterstock.com
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