The past few months haven’t been too kind to Bitcoin. Case in point, since peaking at $14,000 this June, the cryptocurrency has fallen by 50%, tumbling as low as $6,400 due to selling pressure from PlusToken and weak hands.
Despite this strong retracement, there is a confluence of technical factors that suggest the medium-term future is bright for Bitcoin. Here are a few, broken down by NewsBTC.
Number 1: Bitcoin Hash Ribbons Signal “Buy”
In November, the Hash Ribbons, an indicator tracking moving averages of Bitcoin’s hash rate, saw a bearish crossover, resulting in an event known as “miner capitulation.”The previous bearish crossover in the Hash Ribbons was last seen just before the now-infamous crash from $6,000 to $3,000 in late-2018.
Though, according to digital asset manager Charles Edwards, who has popularized the Hash Ribbons and the talk around Bitcoin miner capitulation over recent months, a “buy” is rapidly forming on the Hash Ribbons indicator just a few days after “recovery” was signaled.
A Buy signal is forming on the Hash Ribbons indicator.
— Charles Edwards (@caprioleio) December 27, 2019
This is notable. Previous “buy” signals by the Hash Ribbons came shortly after macro bottoms, followed by fully-fledged bullish reversals. Case in point, the Hash Ribbons printed a “buy” in the middle of January, months before BTC broke from $4,000 to $5,000, which created a domino effect pushing BTC to $14,000 by June, ending a 330% rally from the bottom.
Number 2: Golden Cross
Earlier this month, Bitcoin’s long-term chart saw an extremely bullish sign from a macro perspective: the 50-week and 100-week simple moving averages saw a crossover, with the former crossing above the latter, signaling that bulls are in control of the long-term cryptocurrency trend.
This was last seen in mid-2016, prior to the parabolic run-up that brought Bitcoin from $500 to nearly $20,000 in a few years’ time.
We argue over short-term moves but big picture is clear👀
Let’s rock 2020💰
Who’s with me? pic.twitter.com/SmbIu5CgFB
— Crypto₿irb (@crypto_birb) December 23, 2019
Number 3: Klinger
According to a recent tweet from full-time cryptocurrency trader Crypt0mer, Bitcoin’s one week chart recently printed an extremely bullish signal: the one-week Klinger Oscillator, which tracks volume and price to determine trends, has printed a buy for the first time since February 2019, when BTC was trading around $3,700. He remarked that this is a sign that the bear correction is over.
Number 4: “Massive” Bullish Divergence Between Bitcoin and Indicator
Scott Melker, also known as the Wolf of All Streets, recently observed a positive sign on Bitcoin’s weekly chart. The sign is a “massive bullish divergence in oversold territory on Stochastic Relative Strength Index.”