Bitcoin is currently on the cusp of a significant movement as it tests a crucial level for the third time since August. According to renowned crypto chart analyst Ali Martinez, this level could herald a substantial move for Bitcoin, potentially leading to a bullish breakout. The last time Bitcoin surpassed this level, it soared to $70,000. Could we be on the brink of another massive price surge?
Importance Of 200-Day SMA
Bitcoin has experienced an impressive increase of over 8.7% in the past week, following the recent announcement of a Fed rate cut. This upward momentum has propelled the cryptocurrency to $63,000, bringing it within close proximity to the critical $64,000 mark of the 200-day Simple Moving Average (SMA).
The 200-day SMA is a pivotal indicator used by traders to gauge the average price over the last 200 days. This line provides a long-term perspective of the market trend. When Bitcoin crosses above it, it often signals an impending bullish move.
Bitcoin Approaching Critical Level
Crypto analyst Ali Martinez points out that Bitcoin is currently testing this critical level, situated around $63,176, for the third time since August. After several attempts to breach this resistance since August, it has returned to test this level once more.
In October 2023, Bitcoin broke above its 200-day SMA at approximately $28,000, triggering a massive rally driven by excitement over a potential spot Bitcoin ETF approval in the U.S. This led Bitcoin to reach an all-time high of over $70,000 by March.
Now, similar conditions are unfolding. With the recent approval of options trading for BlackRock’s Bitcoin ETF and increasing institutional interest in cryptocurrency, many experts believe another breakout is imminent. A sustained move above the 200-day SMA could initiate a new bull run, propelling Bitcoin back into the $64,000 to $74,000 price range and attracting even more investors into the market.
Bitcoin Liquidations Show Caution
Bitcoin is currently hovering near its 200-day Moving Average (MA), a critical level for traders. According to data from CoinGlass, approximately $16.42 million worth of long positions and $7.12 million in short positions were liquidated in the past 24 hours.
This data indicates that traders are proceeding with caution, as liquidation levels suggest there is minimal downward pressure on the market at this time. The careful approach by traders underscores the significance of the current price levels and the potential for a major move.
