The pressure of the sellers is currently mounting on Bitcoin. A significant decline of 10.60 percent from May 20-21 did nothing to boost the depreciating bullish momentum as Bitcoin plunged below $9,500.
As the token held its position about $9,200 at the moment, there was a lack of justification for Bitcoin’s next bullish rally. Nonetheless, it may have started after the asset had experienced another bullish push in the charts, popularly known as the Golden Cross.
What is the Bitcoin Golden-Cross Theory?
The Bitcoin Golden-Cross phenomenon has attracted publicity over the years since it has traditionally contributed to extended bullish cycles for the largest digital asset. The Golden Cross emerges for BTC as the short-term 50-Moving Average for Bitcoin rises above the long-term 200-Moving Average. The completion of the latest Golden Cross can be identified in the chart below.
Ironically, the cross was also completed on the day Bitcoin dipped below $9,500. The price rally after the golden cross can not, however, be taken lightly.
Over the past half-decade, Bitcoin has undergone four Golden Crosses in the charts. A recent successful gold cross can be traced back to 2019. On April 24, 2019, Bitcoin completed its second golden cross in almost four years, which led to a rally of 178.96 per cent for Bitcoin. The asset had reached its annual high of $13,800.
However, on 28 October 2015, the golden cross of Bitcoin continues to leave a lasting image to the optimists of Bitcoin. Following the crossover in 2015, Bitcoin began a two-year-long rally, which saw a price surge of astounding 6577 percent. The rally ended after Bitcoin had peaked at $20,000. The strength of a golden cross is therefore undeniably evident in Bitcoin ‘s history.
Then why did Bitcoin’s 1st golden cross in 2020 failed?
As mentioned above, Bitcoin has completed four golden crosses since 2015.
- Golden Cross on 28th October 2015
- Golden Cross on 24th April 2019
- Golden Cross on 18th February 2020
- Golden Cross on 21st May 2020
Now, the returns from 2015 and 2019 were extremely lucrative, but the 1st golden cross did not proliferate in 2020 with the same type of bullish movement. It’s because Bitcoin wasn’t responsible for the ‘Black Swan event’ that unfolded in March. The digital asset could hardly do anything when the collective financial sector collapsed around the globe.
As a result, the golden cross on 18 February failed mostly due to the effects of the current global pandemic rather than the expertise of Bitcoin.
Can the Golden-Cross on 21st May, be bullish?
There is a strong argument for Yes, but again, nothing is completely certain and predictable in the cryptocurrency market. It is important to note that Bitcoin underwent a halving only 10 days ago, so the correction period is bound to take place in the charts. However, considering the asset gathers its bearing back towards the 2nd half of 2020, alongside the bullishness of the market, the asset might as well surpassed its 2019 high of $13,800.
According to partial results, even if Bitcoin were to increase by 100 per cent from May 21, the valuation would reach nearly $18,000, which would make the community much more peaceful. So the effects of the Bitcoin Golden Cross are something we need to look out for as we move into the second half of the year.