Bitcoin briefly fell below its 200-week moving average twice over the past two weeks, a relatively uncommon move that Kraken says has historically aligned with strong long-term buying opportunities.
Bitcoin (BTC), recently trading around $62,708, has been hovering near a level that has often preceded powerful bullish phases, Kraken Chief Economist Thomas Perfumo told CoinDesk.
That level is the 200-week simple moving average (SMA), a long-term trend indicator based on the average price over roughly four years, used to smooth out short-term volatility and highlight the broader market direction.
In the last two weeks, BTC dipped under this threshold on two separate occasions before reclaiming it by week’s end. At the time of reporting, Bitcoin was trading near $63,900, just above the 200-week SMA at $62,358.
Perfumo noted that weekly closes below this level are rare, occurring in only about 10% of trading days since 2017, and have historically marked periods where long-term buyers were heavily rewarded.
He added that “buyers at this level have historically achieved median returns of over 113% after one year and more than 313% over two years.”
The median figure reflects the middle outcome across all historical instances, meaning half of the returns were higher and half were lower, offering a more balanced view than averages that can be distorted by extreme gains.
The historical pattern also suggests relatively limited downside risk for investors who enter at these levels.
Perfumo said that buyers accumulating below the 200-week SMA have typically broken even within just two days on a median basis, while the maximum drawdown over the following year has averaged around 9%.
Still, he cautioned that historical performance does not guarantee future outcomes, even though past cycles suggest Bitcoin has often represented strong value when trading near this long-term trend line.
