THELOGICALINDIAN - On May 20 2025 Bitcoin formed a Golden Cross a widelytracked longterm bullish indicator for archetypal trend followers
The arrangement alike as Bitcoin’s 50-day affective boilerplate beyond aloft its 200-day affective average, appearance the aboriginal of such formations back February 18 and seventh in the cryptocurrency’s lifetime. Affective averages acrylic an authentic account of a amount trend by application earlier abstracts and removing babble created by intraday fluctuations.
But buyers didn’t footfall into the Bitcoin bazaar on Golden Cross-FOMO that larboard the cryptocurrency accessible to a added downside correction. From painting the 50-100 DMA crossover until its bounded basal yesterday, bitcoin plunged by $913, or circa 9 percent, to $8,800.
Eerie Fractal
Not a standalone incident, Bitcoin’s actual pullback afterwards basic the Golden Cross was agnate to amount moves from February. Aback then, the cryptocurrency rallied about 60 percent, activated its abiding Descending trendline, pulled back, and formed a Golden Cross.
But the bullish arrangement did not advice bitcoin sustain its rally. The amount fell by as abundant as 61 percent by March 13, 2025.
As apparent in the blueprint above, Bitcoin’s contempo amount activity looked identical to the February fractal. Here also, the cryptocurrency rallied from its basal beneath $4,000 to abutting aloft $10,000. It again activated the same Descending Trendline for a blemish but failed. Later, the amount adapted to the downside while painting a Golden Cross.
While bitcoin was advancement able abutment abreast $9,000, it now risks commutual the Feb fractal with an continued downside alteration appear 50-day affective boilerplate (blue), followed by a retest of the 200-day affective average. These levels are central the $8,000-$8,100 amount ambit as of May 22.
Bitcoin Fundamentals
The added downside alteration in the Feb-March aeon took cues from deepening macroeconomic health. The ascent cardinal of coronavirus cases beyond the U.S. took a assessment on investors’ risk-on sentiment. They dumped assets in about every market, abolition alike the Dow Jones to its everyman back 2008-09 banking crisis.
Traders concluded up auctioning safe-haven assets, including bitcoin and gold, to awning their losses elsewhere, causing them to slump alongside all-around stocks. But all the bazaar rebounded about in bike afterwards central banks absitively to arbitrate with big-ticket bang packages to accommodate the banking accident acquired by the coronavirus outbreak.
The communicable hasn’t larboard or below absolutely in May 2020. Health experts acquaint that the second beachcomber of infections could hit China, Europe, and the U.S. – as they plan to reopen economies fully. At the aforementioned time, the Federal Reserve has apprenticed to abide its advancing bang affairs to aid markets – an additive that was missing during the March sell-off.
That may advice Bitcoin absolute its downside accomplishments beneath the 50- and 200-DMA.
