Bitcoin's 200WMA Climb Signals Potential Cycle Top Amid Bullish Patterns

Coin WorldFriday, Jun 20, 2025 2:17 pm ET
2min read

Bitcoin's 200-week moving average (WMA) has historically marked the peak of each cycle when it surpasses the previous all-time high. This pattern was evident in major price tops in 2013, 2017, and 2021, where the 200WMA acted as a momentum gauge, filtering short-term volatility and reflecting long-term market sentiment. Currently, Bitcoin is trading well above the $100,000 level, with the 200WMA climbing towards previous all-time highs. Analysts are closely monitoring this trend, as the monthly rate of increase in the 200WMA is accelerating, signaling rising bullish momentum. Bitcoin Magazine Pro warns that if this pattern repeats, the crossing of the 200WMA could indicate a cycle top. However, some traders argue that institutional demand, ETF flows, and reduced supply post-halving may alter this historical behavior. The 200WMA crossing remains a crucial metric for traders as Bitcoin approaches this significant threshold.

Bitcoin has recently formed a bullish inverse head and shoulders pattern, which is a classic chart pattern signaling a potential reversal from a downtrend to an uptrend. This pattern consists of a left shoulder, a head, a right shoulder, and a neckline. The formation of this pattern suggests that Bitcoin could be poised for a significant breakout, with a potential target of $150,000. Additionally, the supply of Bitcoin on exchanges has hit a seven-year low, indicating that investors are holding onto their assets rather than selling, which is a bullish sign for the market.

In addition to the inverse head and shoulders pattern, Bitcoin is also forming a classic bull flag pattern on daily charts. This pattern consists of a strong upward price move followed by a consolidation phase, widely regarded as a continuation signal. The flagpole for this pattern was established during the surge to $112,000 in May, followed by a period of consolidation. This pattern suggests that Bitcoin could be in the early stages of a new bullish cycle, with the potential for further price appreciation.

The fractal pattern in Bitcoin's cyclical price movement is another important indicator to consider. This pattern, which consists of one year of intense corrections followed by three years of expansion, has been observed in previous Bitcoin cycles. The current cycle appears to be following this pattern, with Bitcoin in the expansion phase of its cycle. This suggests that Bitcoin could continue to appreciate in value as the cycle progresses.

In summary, while the 200WMA crossing remains a critical signal for a potential cycle top, the formation of bullish chart patterns and the fractal pattern in Bitcoin's cyclical price movement suggest that the cryptocurrency could continue to appreciate in value. Traders should remain vigilant as Bitcoin approaches these historically significant thresholds, considering both the potential for a cycle top and the possibility of further price appreciation.

Ask Aime: Could Bitcoin break $150K this cycle, and how might it affect my portfolio?