Bitcoin (BTC) started the last week of October in classic fashion, with BTC prices rising by 3%, pushing the cryptocurrency market higher.
BTC/USD is back near the 2023 highs as a resistance war brews, which could become a classic “uptober” for Bitcoin and altcoins. Can the Bulls win?
That’s the key question facing traders and market watchers at this week’s first Wall Street opening, as Asia sets the tone for a crypto comeback.
However, given the level of resistance that needs to be overcome, traders are proceeding with caution – Bitcoin’s high price predictions are not as clear as expected, and few believe the path to $32,000 will open quickly or easily.
Bitcoin will also have to fend off potential headwinds in the form of macroeconomic data printing at a time when inflation continues to exceed expectations.
The final outcome this month will be even more important ahead of the Fed’s Nov. 1 interest rate decision. Meanwhile, geopolitical events have added another element to market unpredictability.
With so much at stake for cryptocurrencies and risk assets, this week looks to be a rollercoaster as Bitcoin bulls seek to achieve a major trend change by breaking out of a multi-month trading range.
RSI has Bitcoin traders scared of rally
According to Cointelegraph, some traders are skeptical of the three-month high and believe that breaking above $32,000 will be a difficult challenge.
Popular trader Daan Crypto Trades said: “It is heading towards the top of the 2023 range.” Summarize Today’s X day.
“It will not be easy to break through $31,000-32,000, but once it is broken, my next target is $38,000. Until then, it will remain range-bound.”
With just hours to go before Wall Street opens, BTC/USD is currently retreating from its highs, returning to the $30,000 mark.
Prominent trader Ali drew attention to the relative strength index (RSI) reading when analyzing the possibility of further declines.
“Unless BTC can maintain a daily candlestick close above $31,560, an imminent price correction appears to be on the way,” part of his comments warn.
On October 23, the RSI reached 77 points. Ali pointed out that since March this year, the RSI has triggered a “significant adjustment.” Generally speaking, any value above 70 is considered “overbought.”
Others are liberally optimistic, including Philip Swift, co-founder of the trading suite DecenTrader and creator of the statistical resource Look Into Bitcoin.
#bitcoin +$30,000.
Goodbye bear.
— Philip Swift (@PositiveCrypto) October 23, 2023
Meanwhile, popular trader CredibleCrypto described a Bitcoin breakout as “imminent.” He updated his original thinking from late August, suggesting a break above $30,000 as a key level for a trend change.
about there… Bitcoin USD https://t.co/13X3yX7Bib
— CrediBULL Crypto (@CredibleCrypto) October 23, 2023
According to Cointelegraph Markets Pro and trading view show.
PCE and GDP will be released on the eve of the FOMC meeting
Personal consumption expenditures (PCE) index data dominated the U.S. macro diary this week, and the timing is striking.
The Federal Reserve will meet on November 1 to decide on interest rate policy. As one of its preferred inflation indicators, PCE is being closely watched by the market. Third quarter GDP is also due.
Although recently released data continues to be higher than expected, highlighting the stickiness of inflation, the possibility of further interest rate hikes remains slim.According to data from CME Group Fed Watch ToolThe probability of a rate cut by the Federal Open Market Committee (FOMC) next week is even 1.6%.
“At the same time, the earnings season is in full swing, and speculation about the Federal Reserve continues. Volatility is a good thing for traders.” The financial commentary resource “Kobeissi Letter” wrote in part of the comments in this week’s macro diary road.
Main events this week:
1. Building Permits – Wednesday
2. New Home Sales – Wednesday
3. Speech by Fed Chairman Powell – Wednesday
4. GDP in the third quarter of 2023 – Thursday
5. Pending Home Sales – Thursday
6. PCE inflation data for September – Friday
There is one week left until the November Fed meeting.
— KobeissiLetter (@KobeissiLetter) October 22, 2023
Skew and others are also watching for a stronger U.S. dollar, with the U.S. Dollar Index (DXY) cooling off a strong uptrend that began in mid-July.
“Look for a trend continuation or a clear breakout of a one-dimensional trend sometime this week or into November,” some comments point out.
Skew added that “big moves” should be coming soon.
Foreign exchange balances show “obvious trend”
The declining trend in BTC balances on exchanges has been frequently reported as it reached its lowest levels since 2018.
According to the latest data from the on-chain analysis platform Crypto quantizationCurrently, the total BTC balance of major trading platforms is 2.024 million BTC.
The FTX circuit breaker in November 2022 accelerated the pace of balance reduction. Although BTC prices have rebounded this year, the trend has not yet reversed simultaneously.
James Straten, a research and data analyst at cryptocurrency insights firm CryptoSlate, noted that exchange deposits are now at their lowest level this year.
“Since the advent of Bitcoin, deposits have consistently exceeded withdrawals. However, with the FTX crash in Nov’22 and the SVB crisis in Mar’23, the trend reversed for the first time,” part of WeekendX’s post read.
“Now, with deposits hitting year-to-date lows and withdrawals stable but still elevated, a clear trend is emerging: tokens are steadily leaving exchanges.”
The chart below shows the proportion of BTC transactions involving exchanges, accounting for 36% of the total transaction volume.
Bitcoin “Newbies” Are Absent This Month
CryptoQuant research warns that Bitcoin price trends, while favorable to market sentiment, are showing “artificial” characteristics.
in one of its places shorthand In a market update on October 22, contributor SignalQuant revealed that the number of new market entrants has been low over the past month.
SignalQuant uses the Sum Coin Age Distribution metric – a method of separating old and new Unspent Transaction Output (UTXO) data.
“Interestingly, when this metric spikes, it’s a turning point for BTC prices in the long term,” he wrote of the week-to-month output that corresponds to “newbies” to the market.
“In fact, when BTC price hit the low in late ’18, when it hit the low in late ’22, and after the Covid crash in March ’20, the 1w~1m entry trend indicator was above the baseline. But now, it is not moving towards the baseline , but remain at a lower level.”
SignalQuant concluded that while no single indicator can provide a holistic explanation of market behavior, the Coin Sum data is “too important to ignore.”
Previously, Cointelegraph noted that long-term holders now control more of the BTC supply than ever before.
There is no market fear in Bitcoin’s ‘scary zone’
After a long period of almost no movement, Cryptocurrency Fear and Greed Index Starting to show signs of volatility.
Over the weekend, the classic cryptocurrency sentiment index surged into “greed” territory, reaching 63/100 – its highest reading since July 12.
The rise coincided with Bitcoin’s attempt to break above $30,000 over the weekend, reinforcing the importance of this price level in traders’ minds.
On the subject, popular altcoin Sherpa described $30,000 as a “scary zone.”
“When looking at price direction, I still think the next high is extremely important,” he said. Tell It had
Like others, altcoin Sherpa highlighted $32,000 as the ultimate bottom line for bulls to break through.
“Basically, if we forcefully break 32k, we’ll hit 40k,” he said continue.
“If we form a lower high here or strongly reject around 32k, I think we will drop to a low of 20k. Gut says 40k but 32k overall is a super strong level and I don’t feel that way powerful.”
This article does not contain investment advice or recommendations. Every investment and trading activity involves risks, and readers should do their own research when making decisions.
Svlook
