Conditions are favorable so far. What will happen to Bitcoin in the coming week?
The expert analyzed the situation on the market and told how it may change in the coming week
On Sunday, October 29, bitcoin (BTC) is trading at $34.2 thousand, its price has increased by 14.5% since the end of the previous week. The specialist analyzed the situation in the market and assessed the prospects for the movement of the bitcoin exchange rate for the next seven days.
- Bitcoin price rose to $35,280 amid optimism around the approval of the bitcoin-ETF.
- The SEC has received a formal mandate to review Grayscale's application to launch a spot bitcoin-ETF.
- SEC Commissioner Hester Pearce stated that the spot bitcoin-ETF should have been approved 5 years ago.
- The DXY dollar index hit a one-month low but was able to recoup all of its losses.
- After the rally, the price entered a consolidation between $33k and $35k.
- This week bitcoin traded in a range from $32,400 to $35,280. On Monday, the price climbed to $34,741 and hit a high of $35,280 on Tuesday. This was followed by a correction to $33,390 on Friday.
On October 23, bitcoin rose 10.26% to $33,069. The rise was driven by several factors. First, the DXY dollar index hit a one-month low on the back of falling US government bond yields. Second, a U.S. court upheld the SEC's review of Grayscale's application to launch a spot bitcoin ETF. Thirdly, the rally was supported by technical factors - liquidation of short positions worth $161 mln and breakthrough of important resistance levels.
On October 24, the bitcoin price rose by 2.58% and reached a high of $35,280. Among the growth factors were the US court decision requiring the SEC to review Grayscale's application, as well as the news that BlackRock assigned a ticker to the bitcoin-ETF pending approval. In addition, support came from a weakening dollar. However, by late afternoon, the dollar index reversed upward, halting the bitcoin price rise.
On October 25, the price growth slowed to 1.69%, to the level of $34,496. Amid expectations of bitcoin-ETF approval, investors ignored the strengthening of the dollar and the decline in stock indices. Investors' attention was drawn to the upcoming halving. Bitcoin's share in the crypto market rose to 51.4%.
On October 26, the price of bitcoin fell by 1% to $34,151. The market was pressured by a strengthening dollar and a drop in tech stocks in the US. The Nasdaq index was down 2% and the S&P 500 was down 1.2%. US 10-year bond yields fell to 4.88%. Fears of recession in the US have increased.
On October 27, the BTC/USDt pair fell by 0.76% to $33,892. During the U.S. session, the price declined to $33,390 amid falling stock indices. Since the end of July, the S&P500 index has fallen 10.2% to 4137. This week, US Q3 GDP data beat expectations, showing the economy accelerating at the fastest pace since mid-2021. Despite US Q3 GDP and expectations of a rate hike in December, fears of a recession in the country remain. Inflation continues to worry the Federal Reserve (Fed).
The US Personal Consumption Expenditures (PCE) index showed that consumer price expenditures rose at the fastest monthly pace since May, but the annualized PCE fell slightly in September, reigniting fears of high-interest rates.
We have a busy week ahead of us. The focus of economic data will be on employment numbers, including ADP's private sector employment report on Wednesday, jobless claims on Thursday, and non-farm payrolls on Friday.
The market expects current monetary policy to remain on hold despite the strong economy and tight labor market as inflation slows but remains above target. In addition, the ISM Services report on the US and China business activity index is expected. Geopolitical events also remain key drivers for traditional assets. Investors will continue to analyze the results of corporate reports.
The BTC/USDt pair is trading above $34k. According to the volume analysis, buying has noticeably decreased since Friday. This is understandable because the price has been in a sideways trend for a long time without continuing the rally. And when the price stands for a long time, the two-day flat starts to get on investors' nerves. At this time short-term speculators, working on the downside, start to get involved.
According to the cyclic analysis, there are no changes. The growth phase should last until November 9. Conditions are still favorable for growth. The absence of upward movement after J. Powell's speech on Wednesday after the FOMC meeting may be an alarm bell for buyers. According to the latest data from CME Group, rates will remain in the range of 5.25-5.50 with a 99.9% probability on November 1 and an 80% probability on December 13.
According to BitRiver forecasts, the decline phase may last from November 9 to November 21. Closing the day below $32,700 is likely to herald the beginning of the correction phase. For the correction, $31,700 should be selected as a support target level. We are waiting for the rate decision, Powell's speech and the US labor market report.
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