BTC Price Strength Could Invalidate Bearish Fractal
Bitcoin (BTC) has managed to hold above $30,000 as analysts suggest that its price strength could potentially cancel out a “bearish fractal.” After the weekly close on October 22, BTC saw a surge in gains and reached its highest levels since July, stopping just below $31,000. Analyst Rekt Capital is now closely monitoring whether BTC can break the $31,000 level. Rekt Capital believes that BTC/USD could disregard the bearish chart fractal that has been present throughout 2023 if it breaches the $31,000 mark. This would invalidate the double top formation near $32,000 and potentially result in further upside.
Encouraging Indicators for Bitcoin
On-chain analytics firm Glassnode’s True Market Deviation indicator has provided more encouraging cues for Bitcoin. The Average Active Investor (AVIV) profit ratio, also known as the True Mean Market price (TMM), has crossed a key level. TMM is now below Bitcoin’s spot price at $29,780. This development led Glassnode’s lead analyst Checkmate to question if Bitcoin has finally paid its dues from the bear market. Checkmate described TMM as Bitcoin’s most accurate cost basis model.
Institutions React to Potential ETF Approval
Crypto insights firm CryptoSlate’s research and data analyst James Van Straten suggests that one of the potential drivers of the recent rally is the potential approval of a Bitcoin spot-price-based exchange-traded fund (ETF) in the United States. Although not yet approved, Van Straten sees a U.S. spot ETF as inevitable following legal battles that weakened regulatory influence. He notes that this potential approval has sparked a significant increase in bullish inflows in the crypto market. Inflows via over-the-counter (OTC) trading desks have been spiking since late September, indicating an optimistic market response to the potential ETF approval.
The Grayscale Bitcoin Trust (GBTC), the largest Bitcoin institutional investment vehicle, has also seen a lower discount to the Bitcoin spot price. As of October 23, it had a negative margin of -13.12%, its smallest since December 2021.
Hot Take: Bitcoin’s Price Strength May Nullify Bearish Fractal
Bitcoin’s recent price strength and potential breach of the $31,000 level could invalidate the bearish fractal that has been present in the market. Analysts are closely monitoring this development as it could lead to further upside for BTC. Additionally, indicators such as Glassnode’s True Market Deviation indicator and the potential approval of a Bitcoin ETF in the United States have provided encouraging signs for Bitcoin’s future performance. The market sentiment remains positive, with inflows into crypto increasing and institutional investment vehicles showing reduced discounts to the spot price. Overall, these factors suggest that Bitcoin’s bullish momentum may continue in the near future.
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