The Bitcoin market appears to be shifting towards a more positive outlook, as indicated by the Moving Average Convergence Divergence (MACD), a commonly utilized technical analysis tool. Financial analyst Jake Wujastyk recently tweeted about an upward MACD cross, signaling possible bullish momentum.
The MACD indicator serves as a valuable tool for traders in determining suitable entry and exit points. It finds relevance in traditional stock markets and is equally applicable within the realm of cryptocurrency analysis.
In order to calculate the MACD line for any coin, you needs to subtract the 26-day Exponential Moving Average (EMA) from the 12-day EMA of the cryptocurrency’s price. The MACD line plays a crucial role in generating trading signals.
Another important calculation is the Signal Line, typically a 9-day EMA of the MACD line itself. By considering the interaction between these two lines, traders are able to make informed decisions regarding buying or selling BTC.
Bitcoin Struggles To Hold Above $31,000
Bitcoin has been trying to consolidate above the $31,000 level after recently breaking this barrier following a favorable ruling in the Ripple v. SEC case. Despite the upward swing, BTC still faces resistance.
Data from CoinGecko shows that the flagship currency is currently trading at $30,305 on major spot exchanges, hovering around the $30,000 mark. Its market cap is approaching $590 billion, and its 24-hour trading volume exceeds $7.6 billion.
According to data from CoinGecko, Bitcoin has experienced a significant decline of approximately 56% since its peak value of $69,044.77 on November 10, 2021. Mike Novogratz, a renowned cryptocurrency enthusiast and CEO of Galaxy Digital, has been monitoring four potential bullish catalysts for the crypto market.
In his recent tweet, he listed these as the Federal Reserve pausing rate hikes, Ripple winning its lawsuit, the approval of a Bitcoin ETF, and Binance settling with the Feds.
Novogratz believes that approving a Bitcoin ETF is inevitable rather than a mere possibility. This development holds significant implications for BTC price, as it would broaden the participation of institutional investors within the cryptocurrency market.
Apart from the MACD indicator, the upcoming halving in 2024 will reduce the supply of new bitcoins by half. Historically, halvings have been followed by periods of increased demand and price appreciation.
Another factor is the increasing adoption of Bitcoin by mainstream companies and institutions. For example, Twitter recently enabled users to tip each other with Bitcoin using the Lightning Network, a layer-2 solution that enables fast and cheap transactions.
These recent developments indicate a growing recognition and acceptance of Bitcoin worldwide, suggesting potential value appreciation and increased adoption in the future.
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