Bitcoin's Golden Cross Signals 51% Gain Potential

Bitcoin’s recent momentum has sparked optimism among analysts, with the confirmation of a bullish golden cross technical formation suggesting potential gains of over 50%. This formation occurs when the 50-day moving average crosses above the 200-day moving average, indicating a strong upward trend. According to an analysis by TradingShot, this golden cross is the fourth bullish leg within a long-term “channel up” pattern that began after the November 2022 bottom. This channel has reliably guided Bitcoin’s price through multiple consolidation phases, often around the 0.5 Fibonacci retracement level, before each breakout.

The weekly MACD (Moving Average Convergence Divergence) has also printed a bullish cross, further supporting the upward trend. Historically, these indicators have preceded significant rallies, and the current market structure shows strong similarities. Bitcoin remains within its upward channel and appears to have room to move higher. Based on Fibonacci extension levels and the prevailing bullish pattern, TradingShot projects Bitcoin could climb to as high as $165,000, a potential 51% increase from its current price near $109,000.

In response to the golden cross, analysis from SmartReversal has outlined several key short-term price levels to monitor. The upper Bollinger Band, which previously widened during periods of consolidation, has started to flatten and curve downward. This marks a shift from earlier behavior and could point to waning momentum. At the same time, the Relative Strength Index (RSI) has dropped to 65.79 after peaking near 84, even as prices continued to rise. This kind of bearish divergence is often an early warning of a possible reversal.

Currently, Bitcoin is facing resistance near $111,195, a level that coincides with a local high and the upper Bollinger Band. On the downside, support lies around the 20-day MA which is approximately $109,191, the 50-day MA, which is near $105,595, and the 200-day MA at $96,716. If Bitcoin fails to push past the $111,195 resistance level and the RSI keeps trending lower, a pullback toward the 20- or 50-day MA may follow. A drop below the 200-day average could signal a more bearish medium-term outlook. On the flip side, a clean breakout above the upper Bollinger Band would invalidate the bearish divergence and confirm the continuation of the bullish trend.

Bitcoin is currently holding steady at nearly $110,000 despite lingering recession concerns. Notably, momentum is gaining support from increased corporate interest in holding Bitcoin as a treasury asset. For instance, Trump Media and Technology Group, the parent company of Truth Social and partly owned by Donald Trump, announced a $2.5 billion capital raise to purchase Bitcoin. The funding includes a $1.5 billion stock sale and $1 billion in zero-coupon senior secured bonds. The deal is expected to close on May 29.