Bitcoin is moving sideways after dropping from the $49,000 region. The market’s first cryptocurrency appears to be showing conviction, as the bears cannot regain control of the current price action.
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At the time of writing, BTC is trading north of $48,000, a critical support area that could support a fresh jump to previous highs. Although on the lower time frames there was some “crab-like” behavior, the higher time frames still registered significant gains.
Trader Justin Bennett Believes The key to the next phase will open as Bitcoin returns to the $50,000-$53,000 region. If the bulls manage to break through these levels, BTC price should re-enter the $60,000 area for the first time since May 2021.
Otherwise, Bitcoin could still see some downside risks towards the mid region from its current levels at $45,000. Failure to maintain this support could lead to a return of BTC to the $40,700 area with the risk of a further slide to $36,500, as shown below.
Unlike September, October has historically been a green month for BTC. Many traders are betting on this possibility.
Therefore, the rapid shift in market sentiment to the upside as BTC climbed its way up from the $40,000 low to its current levels. In addition, merchant John Wick Believes There are the right ingredients and environment to support the all-new high, as shown below.
Bitcoin at a Crossroads, Why Could More Gains Lead to New ATH?
In a separate report by Glassnode Insights, analyst Checkmate notes that 10.3% of the bitcoin supply has returned to an unrealized state of profit. This indicates that a lot of buyers entered positions as BTC was moving in the $40,000 to $41,000 range.
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Hence, why did the price of BTC find a “price floor” around those levels. As of now, about 86.6% of the total BTC supply stands in unrealized profit, as shown in the chart below.
This increases investors’ incentives to take either route depending on the Bitcoin price movement. More investors can keep their profits, if the price continues to rise, or they can make some of their gains if the price goes the other way. Analyst said:
If the market continues to go up and in an uptrend, this fractal will be similar for both the 2013 and 2017 market. In both the previous cycles, the NUPL value of 0.5 acted as a “support” level during major corrections as the market’s profitability and belief in stability were tested, rebounding and later rising .
In support of the bullish thesis, Glassnode reports a daily capital flow of $1.75 billion into the market as per buy order.
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In addition, lifetime ranges with spent volume, a metric used to measure the total percentage of bitcoin supply exchange hands, indicate that “the old hand has a strong conviction and is not spending at current prices.”
