Bitcoin has recently flirted with a level that has historically proven to be a near-perfect entry point for bulls, generating handsome returns, Kraken chief economist Thomas Perfumo told CoinDesk.
This level is the 200-week simple moving average (SMA), which represents the average price of the token over that time frame, providing traders with a clear overview of the long-term trend while reducing day-to-day noise.
Twice in the past two weeks, BTC briefly fell below its 200-week SMA before climbing back above it at the end of each week. As of this writing, bitcoin is trading at $63,900, just above the 200-week SMA of $62,358.
This is notable because, according to Perfumo, closes below this level have been rare, occurring only about 10% of trading days since mid-2017, and have historically marked unusually attractive entry points for buyers.
“Historically, buyers at this tier have seen median returns in excess of 113% over the next year and 313% over two years,” Perfumo said in an email.
