Over the past two years, Bitcoin (BTC) has seen a strong positive price performance, rising by over 300% since the start of 2023. In 2024 alone, the cryptocurrency market leader has surged by 40%, reaching a new all-time high of $73,750 in March. However, recent price developments indicate that Bitcoin’s upward price trajectory may undergo significant changes in the coming months.
The 200-day simple moving average (SMA) indicates that the Bitcoin price is at a crossroads
In a Publication X On Saturday, popular cryptocurrency analyst Ali Martinez shared that the price of BTC recently fell below its 200-day simple moving average (SMA), indicating that the asset is subject to a change in price movement.
For context, the simple moving average, one of the most common trading tools, is used to identify trends in price data over a specific period, for example, 200 days. As the name suggests, the indicator represents the average of all price points in the given period, allowing traders to gauge the overall direction of the market.
Traditionally, when an asset’s price crosses above the simple moving average (SMA), it signals a price change in an upward direction, although the reality of the expected price increase depends on the time frame of the simple moving average. On the other hand, when a token’s price falls below the simple moving average, it represents a sell signal, as a price decline is expected.
However, Martinez posits that BTC’s current drop below its 200-day SMA is temporary and presents a buying opportunity for investors, supporting the token’s potential to maintain its current uptrend. Nonetheless, in a situation where Bitcoin’s stay below the 200-day SMA is prolonged, the analyst predicts that such a development could kick-start a bear market for the top cryptocurrency.
Bitcoin Price Overview
based on CoinMarketCap dataBTC is trading at $59,995, down 1.77% over the past seven days. This negative performance underscores the asset’s struggles over the past month during which it lost more than 8% of its value, briefly dipping below $50,000. However, community sentiment on Bitcoin remains largely optimistic, indicating that many investors support the token’s long-term profitability.
The leading cryptocurrency has been repeatedly predicted to reach six-figure values based on historical price data and other factors, including Bitcoin spot ETF market And more recently potential changes In the US government’s policy on digital assets, however, Bitcoin’s short-term price targets for now lie at $62,000 and $70,000, both of which present significant resistance levels for the cryptocurrency market leader.
Featured image from Coinmonks, chart from Tradingview
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