Historical trends related to Bitcoin’s 200-week simple moving average (SMA) suggest the current price range of $90,000 to $110,000 may eventually resolve in a bullish direction, despite concerns over inflation in the U.S. potentially posing challenges to the market’s momentum.
As of the latest data, Bitcoin’s 200-week SMA stands at $44,200, the highest level it has reached to date, according to TradingView. However, this figure remains significantly lower than Bitcoin’s previous bull market peak of $69,000 in November 2021.
This difference is crucial because, based on previous bull market cycles, the 200-week SMA typically rises to match the high prices of prior bull markets as those trends come to an end. For example, in late 2021, the 200-week SMA reached $19,000, coinciding with the peak of the 2017 bull market. Likewise, the end of the 2017 bull run was marked by the 200-week SMA matching the 2013 high of over $1,200.
If history is any guide, Bitcoin’s current trading range between $90,000 and $110,000 is likely to break out to the upside, leading to a renewed bullish phase for the cryptocurrency.
Market data from Deribit further supports this outlook. According to Amberdata, options expiring in three months or more show that call options are commanding higher premiums than put options, which implies the market expects Bitcoin’s price to rise.
Additionally, the bulk of open interest is concentrated in call options with strike prices above Bitcoin’s current trading level of $96,700. The most popular call option has a strike price of $120,000, with over $1.8 billion in open interest, indicating strong market confidence in Bitcoin’s future price growth. Open interest refers to the total number of outstanding contracts in the options market.
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