As a researcher with over a decade of experience in the cryptocurrency market, I’ve seen my fair share of bull runs and bear markets. The recent rally of Bitcoin to $65K has been nothing short of impressive, but as history has shown us, every good thing must come to an end.
After a 3.47% dip on September 30, Bitcoin‘s third-quarter performance currently hovers around 0.89%. There’s optimism in the crypto community for an upward trend in October and the rest of the year. Reflecting this enthusiasm, Bitcoin’s price has risen by 1% today, reaching approximately $63,955. So, what might BTC do next? This is a question on many investors’ minds.
Why Did Bitcoin Rally to $65K?
Over the past seven months, I’ve observed a pattern where Bitcoin’s price has been moving cyclically due to consolidation. Specifically, during the last five months, I’ve noticed that local peaks and troughs have been forming around the first or third weeks of each month.
Following a 10% drop in Bitcoin’s value during the initial week of September, it hit a temporary low on September 6 and initiated an impressive 26% surge to reach $65k. This rise can be attributed to this specific event, but it’s important to note that broader economic policies also played a role in driving Bitcoin up to its $65k peak.
A significant factor in this upward trend was the U.S. Federal Reserve’s decision to reduce interest rates by 0.5% on September 18. The remaining cause for this increase can be traced back to a reduction in interest rates by the Chinese central bank, combined with their stimulus package.
Remarkably, this action by China led to a significant surge in the stock market, marking the largest one-day increase since 2008.
Bitcoin’s Strong Recovery in Question
Investor enthusiasm has surged at the beginning of the fourth quarter, driven by positive historical price trends. Over the past 13 years, October has been the third strongest month for Bitcoin, averaging a return of 26%, only beaten by April and November. Moreover, the fourth quarter as a whole has demonstrated exceptional performance, with an average return of approximately 80%.
Looking at how Bitcoin has surged by 26% to reach $65K, it’s understandable why investors are optimistic. Yet, it’s essential for traders to practice caution, as there may be signs of an upcoming correction in the Bitcoin market.
After a seven-month period of stabilization, significant peaks and troughs have appeared at the end of the third and first weeks in recent occurrences. Specifically, four out of the last eight peaks occurred during the third week, while two were formed in the first week. If this trend continues, it suggests that Bitcoin may have already reached a short-term peak, and a potential correction might follow soon.
The 30-day MVRV Ratio (Market Value to Realized Value) indicator from Santiment is indicating a sell signal for Bitcoin, as it suggests investors have made substantial profits in the last month on their BTC purchases. A high positive value in this context means there are unrealized profits, which can be interpreted as a sign to sell and lock in these gains, while a low or negative value would suggest holding onto the investment or buying more.
During Bitcoin’s seven-month period of stability, noticeable high points (local tops) have appeared when the 30-day MVRV ratio ranged between 4% and 8%. Currently, as of October 1st, this on-chain metric has dropped significantly from 8% to almost 4%, indicating a potential decrease in price.
According to the technical indicators we’re looking at, it seems quite probable that we might see a correction soon. If, however, there’s a change in direction, let’s delve into potential areas where Bitcoin’s price might stabilize.
Bitcoin Price Forecast Hints a Revisit of $61K
Looking at the immediate future, Bitcoin might experience a slight drop. But don’t be alarmed by this decrease, as it offers potential buyers an opportunity to stockpile. This correction won’t weaken Bitcoin’s optimistic outlook suggested by the Mars-Vesta theory, which predicts Bitcoin could reach a new all-time high of six digits in October 2025.
The day-to-day Bitcoin chart presents two possible outcomes: either a drop in price below $62,350 triggers more sellers, extending the upward trend, or a significant price decrease occurs, moving towards the support levels of $61,837 to $60,345.
As a crypto investor, I’m optimistic about the long-term prospects of Bitcoin, despite some temporary dips. After seven months of consolidation, its price prediction suggests a bullish trend ahead. The upcoming soft-landing anticipated by the US Federal Reserve and the conclusion of the US presidential election could trigger significant volatility in Q4 2024. This volatility might even lead to a retest of Bitcoin’s all-time high at approximately $73,777.
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2024-10-01 16:23