Bitcoin: watch out for the golden cross
Bitcoin: watch out for the golden cross

Bitcoin: watch out for the golden cross

By Federico Izzi - 18 Feb 2020

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In the coming weeks, the focus of technical analysts will be catalyzed by the developments of Bitcoin’s “Golden Cross” signal, which is being finalized in these hours: to be precise, there is now a cross from bottom to top on the daily chart between the 50 and 200-period averages.

When the Golden Cross signal was last seen, precisely in April 2019, in the following weeks, it had registered a bullish increase of more than 170%, seeing Bitcoin prices multiply by 2.5 times

The previous Golden Cross signal can be found by going back to October 2015: the signal returned for more than two years and with the peaks of December 2017 saw a stellar rise that in two years had multiplied by 90 times the value of Bitcoin, which went from 200 to 20,000 dollars. 

Looking into the recent period, the intersection of the 50 moving average will be the subject of debate and attention in the coming weeks. If this were to have a partial match with what happened in 2019, with an increase of 170% in a month, we should expect prices to return above $12,200 in the coming weeks, which are precisely the levels of last August.

For Bitcoin, the rise of these days has reinforced the trend that began at the beginning of the year, reaching over 40% with the highs recorded over the last weekend.

bitcoin golden cross

Looking at the whole sector, after the strong turmoil that started over the weekend and continued yesterday, there is a battle between Bears and Bulls resulting not so much from the bearish action that has been recorded in the last three days, but also from a prevalence of sales that have probably taken place with the profit-taking after the strong rises of the last two weeks. 

Today, among the top 20 crypto per market cap, only one red sign emerges, that of Monero (XMR), which loses 2%. Among the best is Bitcoin Satoshi Vision (BSV), which gains 16%. For several weeks, BSV has been characterized by strong double-digit and even three-digit daily rises

Among the best, there is also the rise of Ethereum (ETH) that with today’s +6% recovers again the threshold of $270, following the downturn which had seen a loss of 17% in a few hours from last Friday to yesterday’s lows, but without going to affect the uptrend in place since the early days of 2020. 

As far as volumes are concerned, they have returned to the levels of last August: even in these hours, volumes remain at around 180 billion dollars in 24 hours. 

The market cap is also rising again and is close to 290 billion dollars after peaking between Friday and Saturday, rising for the first time since last August to over 300 billion dollars.

There is, therefore, a strong correlation during this period both in terms of volumes and market cap and also in terms of Bitcoin prices, with what happened in August 2019.

The bullish movement is characterizing again the altcoins such as Ethereum, which is among the best of the first 20. Also Tezos (XTZ) rises by 8%, while Bitcoin Cash (BCH) and Eos (EOS) rise by 5.5%. From yesterday’s values Bitcoin oscillates around parity.

bitcoin golden cross

The best of the day is Enjin Coin (ENJ) with a rise that today goes beyond 26%, back to the 16 cents which are the highest levels since last June 2019. 

Enjin Coin benefits from the news of the last hours whereby it was announced that their platform sees adoption on the Ethereum mainnet. This ensures further expansion of the Enjin Coin project which allows users using the Enjin platform to exchange fungible and non-fungible tokens by creating and minting new assets. 

Ethereum breaks through 10% of dominance, levels that ETH did not register since July 2019, while Bitcoin returns to decrease its market share to 62%, the lowest level since July 2019. Ripple’s dominance fluctuates around 4.5% in recent days.

bitcoin golden cross

Bitcoin (BTC) and the Golden Cross

Bitcoin in these hours crosses the moving average upward and this is a late signal since last week there was the break of the $10,000 that now is a psychological level that will continue to be an area of short-term clash between purchases and sales. 

Purchases over the past few days have been declining due to the profit-taking of traders and speculation that entered the upside at the beginning of February. 

However, from a technical point of view, Bitcoin is more concerned with the technical level of $10,500 that will have to be violated in the coming days with the support of the volumes that have been missing in recent days when prices have touched this level without having the desired effect. 

It’s a bullish race that from the relative lows at the end of January has seen Bitcoin gain more than 25% which, combined with the lows of December, is a remarkable 60% increase. 

In these cases it is necessary to consolidate the movement by building support levels that at the moment seem to be in the area of 9,500-9,600 dollars, levels tested in the last few hours and from which at the moment there seems to have been a reaction that is bringing the quotations above 9,800 dollars, once again attacking the psychological threshold of 10,000.

Ethereum (ETH)

After seeing the fast comeback to $240 yesterday, the reaction of the new purchases pushes prices back close to $270, one step from the $287 high recorded between Friday and Saturday, the highest level not recorded since early July 2019.

For ETH, the trend remains decidedly upward. In the event of a push above $290 in the next few hours or days, it would further strengthen.

In case of a return below Sunday’s lows to $235, the next level of support is set in the area of $225-215, a level abandoned at the beginning of last week. 

Federico Izzi

Financial analyst and independent #trader – S.I.A.T. & partner. He operates actively on stock and derivatives markets (futures and options) since 1997. A precursor of cyclic-volumetric analysis he is known for having identified the most important upward and downward movements in the financial markets of recent years. He participates annually as a speaker at the ITForum in Rimini since the 2010 edition and InvestingRoma and Napoli since the first edition of 2015. He is a guest and market expert on the "Trading Room" and "Market Driver" broadcasts of Class CNBC, Borsa and on the evening news of Traderlink. Since July 2017 he is a permanent guest on LeFonti.TV, the only weekly national space dedicated to cryptocurrencies alongside the most important international experts in the field. He was interviewed as a cryptocurrency expert for Forbes Italia, Panorama, StartupItalia and DonnaModerna. He was recognized as the first Italian technical analyst to have published the first secular cyclic analysis on Bitcoin. Periodically publishes articles on ITForum News, Sole24Ore, MILANOFINANZA, TrendOnLine and Wall Street Italy. Federico Izzi is... "Zio Romolo".

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