BTC is approaching a golden cross, as Moody’s downgrade has validated concerns about the sustainability of U.S. fiscal debt—concerns that bond markets had already priced in.
Bitcoin’s price chart reflects a bullish pattern similar to the one that preceded its late 2024 surge from $70,000 to $100,000, which unfolded amid growing concerns over the long-term sustainability of U.S. debt.
According to charting platform TradingView, the leading cryptocurrency by market capitalization is likely to confirm a “golden cross” in the coming days. This pattern emerges when the 50-day simple moving average (SMA) crosses above the 200-day SMA, signaling that the short-term trend is overtaking the long-term trend and may trigger a significant bullish phase.
The moving average-based golden cross holds a varied track record in forecasting price movements. However, the upcoming occurrence holds particular significance because it follows the recent formation of its bearish counterpart—the death cross—which misled bearish traders and left them poorly positioned in the market.
A comparable pattern emerged between August and September 2024, setting the stage for a decisive breakout above $70,000 in early November. Prices ultimately surged to a new all-time high exceeding $109,000 in January of the current year.
The chart on the left illustrates that BTC formed a bottom near $50,000 in early August of the previous year, coinciding with the 50-day simple moving average crossing below the 200-day SMA, which confirmed 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, credit rating agency Moody’s downgraded the U.S. sovereign credit rating from the top-tier “Aaa” to “Aa1,” citing growing concerns over the national debt, which has now exceeded $36 trillion.
The bond market has gradually priced in fiscal concerns over an extended period. As outlined last week, consistently high Treasury yields signal ongoing government spending and rising sovereign risk premiums—factors that many investors view as favorable for Bitcoin.
