Analysis: Bitcoin’s break below the 200-week moving average may present a historic buying opportunity, with a median return exceeding 100%
Svmuu News: Thomas Perfumo, Chief Economist at Kraken, noted that Bitcoin has briefly dipped below its 200-week moving average twice in the past two weeks, but rebounded quickly each time and reclaimed that level.Currently, the price of BTC is around $63,900, slightly above the 200-week moving average of approximately $62,358.Analysts note that historically, when Bitcoins have dipped below their 200-week simple moving average (200-week SMA), they have often presented significant long-term buying opportunities; past data shows that the median return in such instances has exceeded 100%. Thomas Perfumo noted that since 2017, trading days that closed below this moving average have accounted for only about 10% of the total, but these moments typically correspond to “exceptionally attractive” long-term entry points.Buying BTC near this level yields a median return of approximately 113% over the following year, with a median return of up to 313% over two years. Furthermore, investors typically do not have to endure paper losses for long, as the median time to break even is only about 2 days, and the median maximum drawdown over the subsequent year is approximately 9%. However, Thomas Perfumo also emphasized that past performance is not indicative of future returns, but historical data suggests that BTC Bitcoin within this price range often offers high long-term value. (CoinDesk)
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