With U.S. Debt Mounting, Bitcoin Moves Closer to Golden Cross Following ‘Bear Trap’ Phase

Bitcoin Edges Closer to Golden Cross Amid Moody’s Downgrade and Rising U.S. Debt Concerns

Bitcoin (BTC) is nearing a pivotal technical milestone—the golden cross—just weeks after a bearish death cross caught traders off guard. This bullish signal comes amid growing unease about the sustainability of U.S. national debt, intensified by Moody’s recent credit rating downgrade.

According to TradingView data, Bitcoin’s 50-day simple moving average is set to cross above its 200-day counterpart, a classic indicator that often precedes upward momentum in price. This development echoes a similar pattern observed in late 2024 when a death cross initially spooked the market, only for Bitcoin to rebound strongly and break past $70,000 in November, eventually climbing to a record $109,000 in January.

The death cross that emerged last year near $50,000 acted as a bear trap, misleading many bearish investors. Since early April, Bitcoin has repeated a comparable sequence, building momentum ahead of the anticipated golden cross which could signal a fresh bullish run.

While technical signals are not guaranteed predictors, the broader macroeconomic backdrop lends support to the positive outlook. Moody’s downgrade of the U.S. credit rating from “Aaa” to “Aa1” last Friday highlights escalating concerns over the nation’s $36 trillion debt, shaking investor confidence.

The bond market had already been pricing in fiscal risks, with Treasury yields rising as expectations for continued government spending and sovereign risk premiums grow. These dynamics often boost demand for Bitcoin, viewed by many as a hedge against economic uncertainty.