A golden cross is being approached by BTC, as concerns regarding the sustainability of U.S. fiscal debt have been validated by Moody’s downgrade, echoing apprehensions already reflected in the bond markets.
A bullish pattern is being reflected in Bitcoin’s price chart, resembling the one that preceded the late 2024 surge from $70,000 to $100,000, which occurred amid increasing apprehensions regarding the long-term viability of U.S. debt.
According to charting platform TradingView, a “golden cross” appears likely to be confirmed in the coming days by the leading cryptocurrency by market capitalization. This pattern is formed when the 50-day simple moving average (SMA) moves above the 200-day SMA, indicating that the short-term trend is surpassing the long-term trend and may potentially develop into a significant bullish phase.
The moving average-based golden cross holds a varied track record in forecasting price movements. However, the upcoming occurrence is considered notable, as it is set to appear just weeks after the formation of its bearish counterpart—the death cross—which misled bearish traders and positioned them unfavorably in the market.
A comparable pattern was observed between August and September 2024, laying the groundwork for a decisive breakout above $70,000 in early November. A new all-time high exceeding $109,000 was ultimately reached by prices in January of the current year.
The chart on the left illustrates that a bottom was formed by BTC near $50,000 in early August of the previous year, coinciding with the 50-day simple moving average crossing below the 200-day SMA, thereby confirming the death cross.
In essence, the death cross acted as a bear trap, similar to the one observed in early April of this year. In the following weeks, prices moved upward, ultimately initiating a new upward trend after the golden cross emerged in late October 2024.
Moody’s Escalates Alarm Over U.S. Debt Levels
On Friday, a downgrade of the U.S. sovereign credit rating from the top-tier “Aaa” to “Aa1” was issued by credit rating agency Moody’s, citing mounting concerns regarding the national debt, which has now surpassed $36 trillion.
Fiscal concerns have been gradually factored in by the bond market over an extended period. As outlined last week, consistently high Treasury yields have been interpreted as indicators of ongoing government spending and increased sovereign risk premiums—factors considered favorable for Bitcoin.
