Bitcoin’s 200-Week Moving Average Suggests End of Sub-$47,000 Prices

The cryptocurrency market is abuzz with discussions surrounding Bitcoin’s price action, with many analysts focusing on the 200-week moving average (WMA) as a key indicator. For a significant period, the 200-WMA has acted as a reliable support level, and its recent behavior suggests that Bitcoin may have established a firm floor, making a return to sub-$47,000 prices unlikely. This article will delve into the technical analysis, recent events, and market sentiment surrounding Bitcoin to provide a comprehensive overview of its current position.

As of May 18, 2025, Bitcoin (BTC) is trading at $103,915, reflecting a 0.93% increase from the previous close. The market is showing signs of continued bullish momentum, with several technical indicators supporting this outlook. Let's explore the factors contributing to this positive trend.

Stock market information for Bitcoin (BTC)

- Bitcoin is a crypto in the CRYPTO market.
- The price is 103915.0 USD currently with a change of 954.00 USD (0.01%) from the previous close.
- The intraday high is 104005.0 USD and the intraday low is 102746.0 USD.

Recent analyses highlight Bitcoin's resilience amid market skepticism toward U.S. assets. In April 2025, Bitcoin rebounded by 15%, nearing the $100,000 mark, outperforming major indices like the S&P 500 and Nasdaq. Analysts at Block Scholes observed Bitcoin's changing correlations with traditional asset classes, noting its strong inverse correlation to the Treasury yield curve steepness. This shift has attracted increased investor interest, with $5.5 billion flowing into digital asset funds over three weeks, including $1.8 billion into Bitcoin products. Projections suggest Bitcoin may reach $120,000 in Q2 2025. (reuters.com)

Technical indicators also support a bullish outlook. According to Investing.com, Bitcoin's technical analysis summary indicates a "Strong Buy" signal, with both moving averages and technical indicators aligning positively. (investing.com)

These insights suggest that Bitcoin continues to demonstrate strength and potential for further appreciation in the current market environment.

Recent Price Action of Bitcoin

Bitcoin's price has experienced significant volatility in recent months, but its overall trajectory has been upward. Following a period of consolidation, Bitcoin broke through several key resistance levels, signaling a renewed bullish trend. The recent surge towards $104,000 demonstrates the strength of buyer interest and the potential for further gains. The last few weeks have seen Bitcoin testing and holding crucial support, reinforcing its position as a leading cryptocurrency.

Key Events Influencing the Price:

- Institutional Adoption: Increased institutional investment in Bitcoin, through ETFs and direct investments, has provided substantial upward pressure. Major financial institutions are now offering Bitcoin-related products, increasing accessibility and legitimacy.
- Regulatory Clarity: Progress in regulatory frameworks surrounding cryptocurrencies has reduced uncertainty and encouraged broader participation. Positive regulatory developments often lead to price rallies.
- Macroeconomic Factors: Economic conditions, such as inflation and interest rates, play a crucial role. Bitcoin is often seen as a hedge against inflation, and its value can increase during times of economic uncertainty.
- Technological Advancements: Developments in the Bitcoin network, such as the Taproot upgrade, have improved its functionality and scalability, contributing to positive sentiment.
- Halving Events: Anticipation of the next halving event continues to generate excitement, as the reduction in Bitcoin supply historically leads to price increases.

Technical Chart Patterns

Several technical chart patterns have emerged, providing insights into Bitcoin's potential future movements.

Bullish Pennant: A bullish pennant pattern has been observed on the daily chart. This pattern typically forms after a significant price surge, followed by a period of consolidation in a triangle shape. The breakout from the pennant suggests a continuation of the upward trend, with potential targets calculated by measuring the flagpole of the pennant and projecting it from the breakout point.

Ascending Triangle: An ascending triangle pattern is also visible on the longer-term charts. This pattern is characterized by a horizontal resistance level and a series of higher lows, indicating increasing buying pressure. A breakout above the resistance level would confirm the bullish pattern and could lead to substantial price appreciation.

Cup and Handle: Although less pronounced, a potential cup and handle pattern is forming on the weekly chart. This pattern is characterized by a rounded bottom (the cup) followed by a brief pullback (the handle). A breakout above the handle's resistance level would signal a bullish continuation, with potential targets determined by the depth of the cup.

Key Support and Resistance Levels

Identifying key support and resistance levels is crucial for understanding potential price movements and formulating trading strategies.

Key Resistance Levels:

- $105,000: This level represents a significant psychological barrier. A sustained break above this level could trigger a rally towards higher targets.
- $110,000: A major resistance zone based on previous price peaks. Overcoming this resistance could pave the way for new all-time highs.
- $120,000: A long-term resistance level that many analysts are watching. Breaking this level would confirm a strong bullish trend.

Key Support Levels:

- $100,000: A strong psychological support level. Holding this level would indicate continued bullish sentiment.
- $95,000: A previous resistance level that has now turned into support. This level could act as a buffer during pullbacks.
- $90,000: A significant support level based on the 50-day moving average. Falling below this level could indicate a potential trend reversal.

Technical Indicators Analysis

Several technical indicators provide insights into Bitcoin's current momentum and potential future movements.

Moving Averages:

The relationship between short-term and long-term moving averages is crucial. The 50-day moving average is currently above the 200-day moving average, forming a "golden cross," which is a bullish signal. This indicates that the short-term momentum is stronger than the long-term trend, suggesting continued upward pressure.

Relative Strength Index (RSI):

The RSI is a momentum indicator that measures the magnitude of recent price changes to evaluate overbought or oversold conditions. Currently, the RSI is around 65, indicating that Bitcoin is neither overbought nor oversold. This suggests that the current bullish trend has room to continue before reaching overbought levels. However, traders should monitor the RSI closely for potential divergence, which could signal a trend reversal.

MACD (Moving Average Convergence Divergence):

The MACD is a trend-following momentum indicator that shows the relationship between two moving averages of a security’s price. The MACD line is above the signal line, which is a bullish signal. The histogram is also positive, indicating increasing bullish momentum. Traders should watch for a potential crossover of the MACD line below the signal line, which could signal a weakening trend.

Trading Volume:

Trading volume is an important indicator of market activity. High trading volume during price increases typically confirms the strength of the trend. Currently, trading volume is relatively high, indicating strong participation from both buyers and sellers. Sustained high volume during upward movements suggests that the bullish trend is likely to continue.

Fibonacci Retracement Levels:

Fibonacci retracement levels are used to identify potential support and resistance levels based on Fibonacci ratios. Applying Fibonacci retracement to the recent price swing from the lows around $60,000 to the current high around $104,000, we can identify key retracement levels. The 38.2% retracement level is around $87,000, which could act as a potential support level during pullbacks. The 61.8% retracement level is around $77,000, representing a deeper support level.

Market Sentiment and Fundamental Factors

The current market sentiment surrounding Bitcoin is predominantly bullish, driven by a combination of factors:

Positive News and Fundamental Factors:

- Network Upgrades: Continuous improvements to the Bitcoin network, such as scalability solutions and privacy enhancements, are boosting investor confidence.
- Adoption News: Increasing adoption by mainstream companies and financial institutions is driving demand for Bitcoin.
- Regulatory Developments: Positive regulatory developments in key regions are providing clarity and reducing uncertainty.
- Competitor Performance: While other cryptocurrencies are also performing well, Bitcoin's dominance and stability continue to attract investors.
- Broader Market Trends: Favorable macroeconomic conditions, such as low interest rates and high inflation, are driving demand for alternative assets like Bitcoin.

Comments from Experts:

Many analysts and commentators are optimistic about Bitcoin's future. Some believe that Bitcoin is on track to reach new all-time highs in the coming months, driven by increasing institutional adoption and positive regulatory developments. Others caution that Bitcoin is still a volatile asset and that investors should be prepared for potential pullbacks.

Potential Trading Strategies

Based on the current technical and fundamental outlook, traders might be considering the following strategies:

Long Position with Stop-Loss:

Traders who are bullish on Bitcoin may consider opening a long position (buying Bitcoin) with a stop-loss order placed below a key support level. This strategy allows traders to profit from potential upward movements while limiting potential losses if the price falls.

Buying on Dips:

Another strategy is to buy Bitcoin during price dips or pullbacks. This allows traders to enter the market at a lower price and potentially profit from the subsequent rebound. Key support levels, such as the 50-day moving average or Fibonacci retracement levels, can be used as entry points.

Selling Covered Calls:

Traders who already own Bitcoin may consider selling covered calls. This involves selling call options on their Bitcoin holdings, which generates income while limiting potential upside. This strategy is suitable for traders who believe that Bitcoin's price will remain relatively stable in the short term.

Short-Term Price Analysis

Based on the current technical setup and market conditions, here is a short-term price analysis for Bitcoin:

Bullish Scenario:

If Bitcoin breaks above the resistance level of $105,000, it could rally towards the next resistance level of $110,000. A sustained break above $110,000 could lead to a test of the all-time high and potentially new highs above $120,000.

Bearish Scenario:

If Bitcoin fails to break above $105,000 and instead falls below the support level of $100,000, it could decline towards the next support level of $95,000. A break below $95,000 could lead to a deeper correction towards $90,000 or even $87,000 (the 38.2% Fibonacci retracement level).

Relevant YouTube Videos for Price Analysis

Here are two relevant YouTube videos from reputable sources that offer price analysis for Bitcoin:

Video 1: Crypto Market Crash: HUGE Warning for Investors! | Shocking Bitcoin & Ethereum Price Prediction

Source: https://www.youtube.com/watch?v=4NdHCiyZUbM

Video 2: You Just need 0.1 Bitcoin to be a Millionaire: Michael Saylor

Source: https://www.youtube.com/watch?v=nUPjdusw3oc

Conclusion

In conclusion, Bitcoin's recent price action, technical indicators, and market sentiment suggest that the cryptocurrency is in a strong position. The 200-week moving average has historically acted as a significant support level, and its current behavior indicates that a return to sub-$47,000 prices is unlikely. However, it is important to remember that the cryptocurrency market is inherently volatile and that prices can change rapidly. Traders should conduct independent research, use appropriate risk management techniques, and be prepared for potential pullbacks.

The information provided in this article is for informational purposes only and should not be considered financial advice. Always consult with a qualified financial advisor before making any investment decisions.