As we approach the final quarter of the year, there’s one standout investment that has caught my attention: Bitcoin. Trading Bitcoin primarily relies on technical analysis, as the asset lacks concrete fundamentals. In assessing long-term crypto trends, I prefer utilizing distinct moving averages instead of the typical 50 and 200-day averages.
Bitcoin’s ‘Golden Cross’:
Since Bitcoin operates 24/7, I utilize 30-day and 365-day moving averages to identify the “golden cross” pattern. Just five occurrences of the 30-day average surpassing the 365-day average had happened before this week. This latest occurrence marks the sixth instance and suggests a potential substantial shift in trend. Generally, I regard these indicators with caution due to their nature as lagging signals; however, this time, it’s different. Previous instances of such crossovers have coincided with significant market milestones and aligned closely with Bitcoin’s four-year halving cycles.
The shorter-term signals from earlier crossovers lasted only 30 and 45 days, yet they yielded impressive returns of 17.7% and 85.3%, respectively, before reversing course. These numbers are certainly noteworthy. Historically, three major bullish phases for Bitcoin began with the golden cross, leading to returns of 5789%, 645%, and 353%. This data is eye-opening and underpins my bullish outlook for this quarter.
Technically speaking, a reversal is taking place, and we are witnessing confirmation that the primary trend is resuming. Bitcoin experienced a considerable decline, hit its low point, and is now on the rise again. To reclaim its previous highs of $126,000 set in October 2025, a gain of 48% is required. The reversal appears to be complete, and the risk-reward balance is highly favorable. Anticipate a return to those highs by early 2027.
Jay Woods is the Chief Market Strategist at Freedom Capital Markets.
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