Important facts:
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Bitcoin price has been above the 200-week moving average for 10 weeks.
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As the price fell, BTC approached this line and tested support in this area.
There is one Bitcoin (BTC) price technical indicator that has become relevant these days. This is the 200 week moving average.
Bitcoin price is currently testing its bottom (support) as per this indicator. This has caught the attention of analysts such as rect capitalwho stressed that this situation had not occurred for 9 months.
As the TradingView Explorer chart below shows, Bitcoin has not tested the 200-week moving average support since August 2022. Back then, the cryptocurrency only broke through this line for five weeks and is currently lasting for ten weeks.
During this period, Bitcoin hit its yearly high of $31,000 and then it fell to $26,000, right in the area where this indicator is located. This behavior reflects that support in this area remains for now, even if some of their appreciation has been mitigated.
As the CriptoNoticias Cryptopedia explains, the 200-week moving average is a technical indicator that calculates the average price of an asset over that period. In this way, this metric, also known as the 200-week SMA, is used to identify long-term price trends.
Taking into account that It is considered a bullish sign when the bitcoin price breaks above the 200-week moving average. And vice versa, a bearish signal is displayed when the price is below this line. Because of this, some traders expect the price to break through this zone.
In any case, like any indicator, this should be taken for what it is: just an indicator. As movements are not guaranteed, it is important to also consider other market analysis for a more comprehensive view.