Cryptocurrencies are trading in positive sentiment today, with Bitcoin gaining more than 4%. The catalyst for the increases appears to be a general increase in risk appetite, which reflects a little decline in the dollar index and yields. Politicians in the US have, at least in the short term, broken the impasse over the federal budget for fiscal 2024 agreeing to an additional 45 days for further negotiations. This took off short-term fears of markets, which had been worried about a 'US government shutdown' scenario.
- October (in crypto markets so called 'Uptober') is seasonally one of the best months for Bitcoin and often great also for the broader stock market (although it is also called the month of crashes in reference to 1929, 1987 and 1999)
- Global factors have potentially supported Bitcoin today - we're seeing gains on indices and a drop in yields
- U.S. lawmakers are pushing Garry Gensler to get the SEC to approve applications for Bitcoin ETFs due to the lack of counter-indications that would justify their consistent dismissal
- Bitcoin's rally has led to the liquidation of bearish positions worth nearly $70 million, potentially pointing to another 'market deleveraging' scenario - often positive for bulls
- The altcoin market gains Kusama (6%) or Solana (5%) but the main interest is generated by Bitcoin, which is usually the first to gain in moments of rebound - the other 'altcoins' usually only perform better when Bitcoin approaches overbought levels and enters a sideways trend. Most other cryptocurrencies remain 'dormant' against Bitcoin.
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Create account Try a demo Download mobile app Download mobile appLooking at the BITCOIN chart on the H4 interval, we can see that the price has broken the 23.6 Fibonacci retracement of the upward wave from the autumn of 2022, as well as both moving averages SMA100 and SMA200, which could potentially lead the price to 'attack' the $30,000 level. At the same time, however, the RSI indicates an overbought level near 83 points, and a scenario of a quick pullback to the area of $28,000 (the 23.6 Fibo level, which has turned from resistance into support) is not excluded. Source: xStation5
Looking at Bitcoin in relation to the dollar index cotracts (USDIDX, golden chart), we see that the dollar has gained for almost 11 weeks in a row which may suggest overbought and at least a short-term reversal of this trend - potentially positive for risky assets such as cryptocurrencies. Source: xStation5
Indeed, October for Bitcoin has been very successful historically but it is worth noting that BTC's history to date is relatively short. Rather, the seasonality of October's so-called 'Uptober' can be linked to global and seasonal factors that also make the stock market perform historically strongly in Q4 (Christmas season, positive sentiment). In the crypto sector, however, this has the makings of becoming a kind of 'self-fulfilling prophecy' as long as the conjunction of global factors 'allows' bitcoin to gain. Probably US dollar and yields will be crucial. Source: Cointelegraph
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