An important technical indicator reveals that, if history is anything to go by, Bitcoin’s price shouldn’t go back below $10,000 ever again.
And while it seems like we’re a very long way from this mark right now, it’s important to keep things in perspective. After all, BTC was trading below this level less than 7 months ago.
Bitcoin’s price has been on a face-melting bull run throughout the past couple of months. In fact, the last time it was trading below $10,000 was back at the beginning of September 2020 – about 7 months ago.
Now, one of the more popular analysts and bitcoin commentators, as well as a well-known proponent of the cryptocurrency, Carl ‘The Moon’ Runefelt, explained in one of his recent YouTub videos the reason he thinks bitcoin’s price will never go back below $10,000. At least, if history is any indicator, of course.
As seen in the above chart, one of the most strong indicators – the 200 weekly moving average (WMA), has been increasing steadily over the past months. Now, it sits above $10,000.
The Moon explains that this MA “seems to be the line of last support.”
“Tho HODLers are defending these levels and we can’t break it. We’re not able to break it. This means that […] currently the 200 WMA is at $10,000. So, logically, this means that the Bitcoin price can never again go below $10,000.”
Looking at the above chart from Bitstamp, we can clearly see that the price for Bitcoin has been trending upwards in the long-term, and there hasn’t been a point where the 200 WMA has been on a descending slope since it started showing data mid-2015.
There were a few attempts to breach the 200 WMA, but all of them were ultimately unsuccessful. Even in March 2020, when the price collapsed throughout the Covid-induced global pandemic and markets tanked, Bitcoin ultimately didn’t close a weekly candle below the 200 WMA.
The other two occasions when the price dropped to this level were back in August 2015 when we saw the famous “capitulation candle,” when BTC price took one last dive below $200 and subsequently fired up the bull market of 2017. The other occasion was the bottom of that bull market in December 2018.
In general, Bitcoin’s market has been cyclic. This is an entirely psychological phenomenon where the market goes through different stages, ultimately resulting in cycles. Of course, things can change, but the key here is the assumption that Bitcoin goes up overtime against the USD.
Most recently, Bitcoin is regaining its momentum following a push to $54K after a notable correction and a few days of indecisiveness. Its total market capitalization, at the time of this writing, sits above $1 trillion, which is definitely a huge milestone to consider.
