A golden cross pattern may be set to appear on Bitcoin's daily chart in the coming days. This development is anticipated as the 50-day Simple Moving Average (SMA) has already turned upwards, a precursor to the golden cross formation.

A golden cross happens when a shorter-term moving average (in this case, the 50-day SMA) crosses above a longer-term moving average (usually the 200-day SMA), indicating potential bullish momentum. While a golden cross is generally considered bullish, it may not guarantee immediate and continuous price increases.

A few scenarios might play out if a golden cross is confirmed: Bitcoin could experience a sustained uptrend, aiming for a retest of previous highs and potentially pushing to a new all-time high.

In a second potential scenario, Bitcoin may experience some volatility and sideways consolidation following the golden cross. There may be brief pullbacks as traders take profits or the market digests the bullish signal. Bitcoin might later see further upward movement following a period of consolidation.

Lastly, the golden cross forms but fails to attract sustained buying pressure or is quickly followed by negative market events, causing the bullish signal to be short-lived.

Bitcoin price action

The cryptocurrency market experienced volatility in the early Monday session, with Bitcoin falling to a low of $102,105 after reaching a high of $107,137 earlier.

At press time, Bitcoin was down 1.07% in the last 24 hours to $103,150, with its 24-hour trading volume up 93.87% to $65.98 billion, per CoinMarketCap data, as traders aim to profit from the recent market volatility.

According to Glassnode, $106,600 remains a key resistance to watch for Bitcoin price in the short term, being a supply cluster with 31,000 BTC held there.

Glassnode wrote in a recent tweet, "BTC's price surge stalled just below $106,600, a level with 31,000 BTC held at that cost basis. This supply cluster originated on December 16 and remains unshaken. Holders haven’t redistributed nor averaged down, making $106,600 an important level to watch in the short term."