Bitcoin, the leading cryptocurrency, retreated after testing above $87,000 and is currently trading in the $82,000-$85,000 range.
With uncertainty surrounding Bitcoin’s direction, and the technical outlook back in focus after a prolonged downturn, Binance Research has released an updated analysis.
In its latest report, Binance Research, referring to the golden cross in Bitcoin, stated that the current formation bears similarities to the golden cross of October 2015, and that Bitcoin rose by approximately 150% from its peak level in the period that followed.
Golden Cross Signal in Bitcoin!
Binance Research reported that the “golden cross” formation that Bitcoin, the highest-volume asset in the cryptocurrency market, created in September bears similarities to some past recovery periods.
According to Binance Research, Bitcoin’s 50-day moving average crossed above the 200-day moving average on September 8th, forming a “golden cross.” Prior to this formation, Bitcoin spent 293 days below its 200-day moving average.
At this point, Binance Research’s report examined 12 past examples of golden crosses.
The report states that in the crossovers formed after Bitcoin remained below the 200-day moving average for at least 150 days, the peak gains seen in the following year ranged from approximately 100% to 600%.
However, Binance Research noted that these figures represent the maximum gains achieved over the following period, not the return on one-year holdings.
In contrast, Binance Research noted that in four of the other six cases where the period below the 200-day average was relatively short, the maximum gain within a year remained below 100%.
Similarities with the 2015 Period!
Binance Research states in its report that the current technical pattern is particularly similar to the golden cross seen in October 2015, after which BTC surged by 150%. According to the report, during that period, Bitcoin formed a golden cross after a prolonged correction and then experienced a significant rise. At that time, Bitcoin also recovered its technical outlook after a long period of weakness and entered its next major bull cycle.
However, Binance Research emphasizes that historical similarities do not guarantee future price movements. Due to the limited sample size in the analysis and the potential for overlap between periods, historical performance alone should not be considered a bullish indicator.
Macroeconomic conditions are decisive!
Despite the technical improvement in Bitcoin, macroeconomic pressures persist. Binance Research notes that the US 10-year Treasury yield has risen to 5.17%, reaching its highest level since 2007, and that interest rate expectations are putting pressure on Bitcoin.
According to the report, in the coming period, technical signals as well as inflation and employment data will be closely monitored to determine if Bitcoin can maintain its upward trend.
*This is not investment advice.
