It doesn’t guarantee a major crash, but it suggests Bitcoin may need to cool off before pushing higher.
Interestingly, Bitcoin’s rally came just days after forming a Golden Cross on the chart, when the 50-period exponential moving average (EMA) crosses above the 200 EMA.
When the short-term EMA crosses above the long-term one, it’s often seen as a long-term bullish signal.
But they don’t immediately translate into price gains. In mid-September, for instance, BTC dipped by over 2% despite printing a golden crossover, only to rise after testing the 50-period EMA as support.
A similar scenario could lead BTC price toward its 50-period EMA at around $113,675, a level aligning with the 0.382 Fibonacci retracement line, by mid-October.
BTC Daily Chart Points to $120,000 and Beyond
Zooming out to the daily time frame, Bitcoin has confirmed a breakout from a falling wedge pattern, a bullish setup where price squeezes between two downward-sloping lines before springing higher.
The breakout projects a technical target above $120,000, which conveniently overlaps with the upper boundary of a larger broadening wedge pattern (the dashed range in the chart below).
