Preface

This article delves into the recent findings by CoinDesk analyst and Chartered Market Technician, Omkar Godbole, who has highlighted a positive shift in a major bitcoin momentum indicator. Known for predicting significant bitcoin price movements, this technical instrument has turned bullish. Analysts have projected a potential rally to $150K–$200K, effectively supporting these optimistic forecasts. Understanding the intricacies of these indicators enables both novice and expert traders to make better-informed decisions.

Lazy bag

The Moving Average Convergence Divergence (MACD) histogram signals a bullish momentum. This indicator supports analysts' forecasts: a possible Bitcoin rally reaching $150K–$200K.

Main Body

Recent technical analysis by CoinDesk analyst and Chartered Market Technician, Omkar Godbole, has spotlighted a shift in a prominent bitcoin (BTC) momentum indicator. A historically reliable signal in forecasting large Bitcoin price changes, the Moving Average Convergence Divergence (MACD) histogram has now turned positive. This change reinforces analysts' predictions of Bitcoin climbing to a range of $150,000 to $200,000.

The MACD histogram reflects the variance between the MACD line and its signal line, an essential component for traders when identifying market momentum. The MACD line itself is determined by subtracting the 26-period (days or weeks) exponential moving average (EMA) from the 12-period EMA of an asset's price, while the signal line is the 9-period EMA of the MACD line. A positive MACD histogram suggests a shift from bearish to bullish sentiment, widely regarded by traders as a buy signal.

Bitcoin's weekly chart MACD has recently crossed above zero, showcasing renewed bullish momentum, effectively a buy indicator. Previously, Bitcoin has exhibited robust rallies following the MACD's positive swings, correlating with observed patterns from mid-2024 and early 2023 and resulting in significant price surges.

Highlighting recent market activity, the MACD transitioned to positivity in late October, preceding Bitcoin's breakthrough above $70,000 in early November and its subsequent peak in December. Notably, positive MACD transitions have reliably indicated impending price increases over the last five years, with only one misleading signal in March 2022.

Bolstering these findings, Standard Chartered and Bitfinex analysts suggest that Bitcoin's potential as a global macro reserve asset, coupled with growing institutional adoption and reduced investment thresholds, could propel its price to these previously mentioned levels. This bullish outlook aligns with broader macroeconomic trends supporting cryptocurrency adoption.

Omkar Godbole, the Co-Managing Editor at CoinDesk's Markets team in Mumbai, specializes in market technical analysis, bearing a master's degree in Finance alongside being a Chartered Market Technician. He has accumulated market experience with FXStreet and Mumbai-based brokerage firms and personally holds small amounts of crypto assets, including Bitcoin and Ether.

Key Insights Table