Bitcoin is nearing a major breakout as it nears its 200-day moving average

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Bitcoin has been trying to break above its 200-day moving average (MA), currently sitting at around $64,000, for the past five consecutive days. Historically, the rise above the 200-day MA signals new upward momentum, serving as a key indicator of long-term market sentiment.

Bitcoin is up more than 5% since the announcement of the Federal Reserve rate cut, reaching $63.5k and approaching the critical $64k level of the 200-day moving average.

As Bitcoin approaches its 200-day MA, CoinGlass reports $7 million in long liquidations and $5 million in short liquidations. Low liquidation levels indicate cautious trading and limited downside pressure, suggesting potential upside momentum.

In October 2023, Bitcoin also bounced back above its 200-day MA, which was then around $28,000. That breakout was sparked by anticipation of a spot Bitcoin ETF approval in the US, leading to a strong rally that eventually saw Bitcoin hit all-time highs of over $70,000 by March.

This time, several factors align again to support an eruption. With approval of options trading for BlackRock’s Bitcoin ETF and growing institutional interest in the crypto, many believe that Bitcoin could soon return to the post-ETF price range of $64,000 to $74,000. A sustained push above the 200-day MA could signal the start of a new uptrend, attracting even more investors.

Despite some sideways trading action over the past six months, Bitcoin has delivered excellent long-term returns. Over the past year, the token has risen 142%, far outperforming traditional asset classes such as the S&P 500 (+32%) and the Dow Jones (+24%). Compared to major stocks like Apple (+31%) and Tesla (-1%), Bitcoin remains an attractive investment for those looking for growth potential.

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