This week’s bullish trend for the leading cryptocurrency has been significant. The BTC appears to be consolidating at the $47,000 mark following an extended timeframe, signaling a return to previous price action.
Going by the Golden Ratio Multiplier (GRM) data, the BTC/USD duo on March 27 recovered a critical support zone for a further upward price trend.
Bitcoin Out Of Its Longest Trendline Decline
The GRM is a specialized metric that observes long-term Bitcoin price action trends. It is usually used in determining whether the price of Bitcoin’s growth is overstretched or not compared to its overall evolution as an asset ready for adoption.
The GRM metric is calculated using a log scale consisting of the 350-day moving average (DMA) for Bitcoin and the Fibonacci sequence to arrive at the multiplier outcome of the trendline.
Therefore, the BTC/USD dropping further down the 350 DMA is a clear sign of external price action as it depicts the majority of time spent above the DMA dating back to 2019. Philip Swift created the GRM tool in 2019.
However, as Bitcoin matures to a commensurate level with its adoption, the extremes begin to appear less, signaling a shift in the downward movement.
How Effective Is the GRM?
According to the creator of the Golden Ratio Multiplier tool, Philip Swift, the GRM is an efficient tool because of its viability and ability to show when the market action is overstretched, taking into consideration Bitcoin’s peculiar adoption curve movement and the market periods.
For example, Bitcoin’s most extended recent downtrend below the 350DMA occurred in March 2020 amid the COVID-19 pandemic, but the latest event in 2022 outpaced it by three months to two.
Going by this, the first three months of the year appear to be an exception to the norm as regards the function of the GRM.
Additionally, GRM is used to predict Bitcoin’s market cycle peaks. And in 2019, Swift estimated the next top, which he said would be roughly 3x the 350DMA.
He further added that if the pattern of the Fibonacci sequence keeps going down, as was the case during the events some couple of years ago, the previous market cycle high will occur at a price that is within the area of the 350 DMA.
Once Robust Resistance
The Cointelegraph report on the mid-range timeframes shows that Bitcoin was already showing good performance in terms of trendline throughout the beginning of 2022.
In Q1, there are two moving averages (MAs) providing strong resistance to Bitcoin, and the first hurdle is the 21 and 50-week exponential MAs that the bulls are currently looking to overthrow to put new support in place.
The two MAs show the difference in Bitcoin’s present trading action, which has been in effect since last year with a price range of $28,000 and $69,000, respectively.
Overall, the BTC has performed considerably well throughout the trading sessions and is on course for more positive price actions.