Bitcoin (BTC) is starting the last week of October with a 3% price gain, pushing cryptocurrency markets higher. Traders and market observers are wondering if this could be a classic “Uptober” for Bitcoin and altcoins as BTC/USD approaches resistance near 2023 highs. However, traders are playing it safe due to the significant resistance levels and the uncertainty surrounding the road beyond $32,000. Bitcoin also faces potential headwinds from macroeconomic data prints and geopolitical events. The Relative Strength Index (RSI) readings suggest a possible price correction unless BTC manages to close above $31,560. Despite these concerns, some traders remain optimistic about a breakout, targeting $38,000 as the next level.
The upcoming U.S. macroeconomic data releases, including the Personal Consumption Expenditures (PCE) Index and GDP figures, are crucial ahead of the United States Federal Reserve’s interest rate decision on November 1. Despite persistently high inflation, further rate hikes are unlikely. Volatility is expected in the markets due to earnings season and ongoing Fed speculation.
Skew and others are closely watching U.S. dollar strength, with the U.S. Dollar Index (DXY) potentially breaking its uptrend soon. Additionally, BTC balances on exchanges continue to decline as coins steadily leave exchanges. This trend started after the FTX meltdown in November 2022 and has not reversed despite BTC’s price recovery this year.
CryptoQuant research warns that BTC price action is displaying artificial characteristics due to low numbers of new market entrants over the past month. The Crypto Fear & Greed Index is showing signs of volatility, reaching its highest reading since July 12. Traders view $30,000 as a significant level for Bitcoin, with some describing it as a “scary area.” The ultimate line in the sand for bulls is seen at $32,000.
In conclusion, Bitcoin’s price gains at the start of the last week of October have brought optimism to the market. However, traders remain cautious due to significant resistance levels and potential headwinds from macroeconomic data and geopolitical events. The upcoming U.S. macroeconomic data releases and the Federal Reserve’s interest rate decision will be crucial for market sentiment. The declining BTC balances on exchanges and the absence of new market entrants raise concerns about the artificial nature of BTC’s price action. The Crypto Fear & Greed Index is showing signs of volatility, with $30,000 seen as a crucial level for Bitcoin. Ultimately, breaking through $32,000 will determine the direction of BTC’s next move.
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