Our experts analyzed the state of the market and told us what will happen to the Bitcoin exchange rate in the coming month

October is going to be an interesting period for Bitcoin, which will largely determine further developments in the entire market.

The BTC market continues to stabilize after several events that affected its price in recent months. Bitcoin’s price has reached a one-year low. And at the same time falling by 13% from the July high, which was $31.5 thousand. The fall is due to the accumulation of funds by institutional investors. And that led to a decrease in the supply of BTC on exchanges. Now only 5.83% of the total amount of BTC is in the wallets of crypto exchanges.

Historical analysis shows that a decrease in bitcoin supply on exchanges is often associated with an increase in its price. However, despite this, the opposite trend was observed in September.

Grayscale has won a lawsuit against the US Securities and Exchange Commission (SEC) over the conversion of Grayscale Bitcoin Trust (GBTC) into a spot bitcoin-ETF. This has led to large purchases of BTC by institutional investors. And most of whom are storing assets in cold wallets to increase the safety of their funds. This has also contributed to a reduction in the supply of BTC on exchanges.

The bearish mood in the bitcoin market led to a decrease in trading activity. And the daily trading volume reached a low. However, if the market sentiment changes to bullish, the price of bitcoin, and with it the rest of the cryptocurrencies, will start to rise.

Data from In/Out of Money Around Price (IOMAP) shows that if bitcoin overcomes the resistance at $28.5 thousand, it could stimulate the price to rise to $28.5 thousand. If trading volumes increase significantly, bitcoin’s next rally could exceed this level.

However, if the price drops below $25k, the forecast may be canceled and bearish sentiment may increase.

Hopes for an upward price movement are high

Historically, October is one of the strongest months for VTS. And in 69% of cases the first cryptocurrency grew. The situation in altcoins is a bit different. Many alternative coins have “rewritten the bottom” and continue to trade with about 90% discount. If bitcoin manages to consolidate above the zone outlined above, altcoins could return to early July levels. If Bitcoin manages to consolidate above the zone.

And which has been outlined above, altcoins could return to early July levels. Some coins could go higher. But such a prospect is better to assess individually for each project.

The last few months with a shortage of fresh liquidity. As well as fundamental factors that can return interest in digital assets, the positioning of participants on BTC does not change. And large players continue to “hold” (hold in anticipation of growth), while small players continue to lose money on derivatives inside the price range.

This directly affects the lack of strong price movements. And so far, it is very difficult to say for sure what exactly will be the trigger for a surge in volatility. However, our experts note that such a long sideways (“flat”) formation on BTC will definitely lead to a price explosion in the future.

Weekly feature: Our experts analyzed the market situation and told how it may change in the short term for Bitcoin

Bitcoin has been trading in a narrow range for 28 days now, and there is a risk of a breakout down to $27,500.

In the week from August 6 to August 13, bitcoin demonstrated boring sideways dynamics. And in doing so, stuck in a narrow corridor between $28,700 and $30,400. It feels like Bitcoin is stuck in a traffic jam on the crypto highway and can’t get out of it.

Also investors are clearly bored and yawning as they stare at their monitor screens. Even inflation data in the U.S. could not cause strong price fluctuations. Quotes only slightly swung back and forth and returned back to the range.

Apparently, market participants are indecisive about the prospects of the Fed’s monetary policy. Until there is clarity about the September meeting and spot Bitcoin-ETFs, the price is likely to sleep.

The technical price pattern is not bad for price to consolidate above $30,400. But the lack of volatility in the market during the release of consumer and manufacturing inflation data begs the question.

In the week from August 14 through August 20 the trend line passes through $27,500. This level is the key support, below which it is impossible to fall. Its violation will cause the market to close long positions on the futures market and open the way to $25,300 for sellers. Our experts consider it ideal to stay above $27,800 until September and start a new rally in anticipation of a halving in 2024.

Bitcoin is actually benefiting from this, though. It is better to let it gather strength in a sideways trend. Before breaking into unpredictability with sharp ups and downs. Besides, the longer the consolidation lasts, the more powerful the subsequent spurt.

Conclusions:

Bitcoin is stuck in a narrow price corridor waiting for clarity on the Fed. The sideways dynamics is likely to persist. New catalysts are needed for an exit.

The Bitcoin market is in a long period of quiet. Our experts have analyzed this situation and made conclusions.

The cryptocurrency market is experiencing one of the least volatile periods in its history. And this raises doubts that noticeable jumps in the price of Bitcoin at all will take place in the future. This is what Glassnode analysts wrote in their weekly market report.

Bitcoin’s realized volatility in various month-to-year intervals has declined significantly this year, reaching multi-year lows. Volatility in the year-to-date range is at levels not seen since December 2016. According to the company’s metrics, this is the fourth such period.

The first time there was such a prolonged lull was during the bear market period in late 2015 and early 2016. The bear market of early 2018 was also accompanied by a lack of significant price swings. And in November of that year, it experienced a 50% collapse. However, this was followed by an upswing in April 2019, when Bitcoin’s price rose from $4k to $14k in three months. A prolonged consolidation also took place after March 2020, when the world adapted to the COVID-19 epidemic. Then there was a brief period of stability at the end of 2022.

Bitcoin volatility chart by Glassnode

The price range separating the seven-day high and low price is only 3.6%. In the history of the market, less than 5% of trading days have ever had a narrower weekly trading range. The 30-day price range is even narrower. Periods of consolidation and narrowing of a price range of this magnitude are extremely rare for Bitcoin.

Weekly lows and highs for the bitcoin price. Source: Glassnode

At the same time, Glassnode notes that the number of long-term Bitcoin holders has reached an all-time high, accounting for about 15.6 million BTC (75% of coins in circulation).

What’s next for the Bitcoin price, our experts’ opinions

In general, the technical picture on the daily charts “looks positive for the “bulls”. According to our experts’ estimates, the beginning of fall will be the starting point for a new growth phase. However, now the cyclic analysis points to the advantage of “bears”. And that in conditions of low volatility constrains the market.

Last week, the BTC/USDt pair declined on the background of strong statistics on US GDP. And which gives the Fed grounds for further tightening of monetary policy in the fight against inflation. This raises concerns for investors trading risky assets.

For now, uncertainty and regulatory risks remain amid tough statements from the head of the SEC. Low trading volumes increase the probability of BTC’s decline to the levels of $27,700 – $27,900. But in case of passing the $31,800 mark, the “bulls” will be able to regain the leading position.

Weekly feature: our experts analyzed the market situation and told how it may change in the short term for Bitcoin

The week from July 31 to August 6 was relatively quiet. The BTC/USDt pair traded in the range of $28,585 – $30,047. Increased volatility in the market was observed on August 1 and 2. On August 1, the price of Bitcoin fell to $28,585. The market was pressurized by fears of regulatory action by the Securities and Exchange Commission (SEC) regarding the crypto projects Hex, PulseChain and PulseX. The hack of the Curve crypto exchange was also negatively impacted. And as a result of which hackers stole about $50 million. Despite the fall in quotes in the first half of the day, the daily candle closed with growth at $29,705.

On August 2, Bitcoin was recovering to $30,047. There are two reasons that may have provided support for buyers:

The first one is the release of MicroStrategy’s Q2 2023 report. The company made a profit for Q2 and purchased 12,333 BTC. As of July 31, the company owns 152,800 BTC. The total BTC purchase price is $4.53 billion at an average price of $29,672 per 1 BTC.

Second – Fitch Ratings downgraded the U.S. sovereign credit rating from AAA to AA+ due to a growing budget deficit and a buildup of government debt. The downgrade had a limited impact on the markets. And since with such debt it is an expected event. U.S. government debt service has nearly reached $1 trillion a year. At this rate, debt interest payments will soon become a major spending item in the U.S. budget. Hardly anyone will repay the debt. The share of the dollar is declining in international settlements and in central bank reserves. No matter what anyone says, U.S. bonds are becoming toxic.

Analysis of other factors

Friday’s U.S. labor market data points to a continued slowdown in job growth. 187,000 jobs were created in July. And that is below forecasts. And the figures for June were revised downward to 185k. That’s the smallest job gain since December 2020.

Although the unemployment rate has fallen. And wages have risen, the low rate of job growth suggests the labor market is gradually cooling under the influence of the Fed’s tighter monetary policy and a slowing economy. Companies are cutting back on hiring because of rising costs and an uncertain outlook.

Overall, the data points to weakening employee attitudes and cooling labor demand. This could have a dampening effect on inflation and cause the Fed to slow the pace of rate hikes. Nevertheless, the labor market remains relatively resilient despite the slowdown.

Despite a relatively quiet week in terms of economic events, the key indicator will be the U.S. Consumer Price Index (CPI), which will be released on August 10. It will give an indication of the inflation rate and could affect the US Dollar’s performance and the Fed’s monetary policy expectations.

The dollar ended last week on a weak note after a five-day rally. And the question is whether it was a correction of the uptrend or the beginning of its reversal. Overall, the US inflation report will be a key benchmark in the coming week to understand the outlook for the dollar and monetary policy. Bitcoin did not take advantage of the dollar’s weakness, and that’s a bad thing, as its rebound and a decline in U.S. stock indices could bring down the market more.

Buyers’ activity in the crypto market is low due to fears of a new market crash

The U.S. Attorney’s Office is preparing charges against Binance. However, it fears that it may provoke a massive outflow of user funds, as in the case of the bankrupt FTX.

DOJ officials are rumored to be concerned that filing criminal fraud charges against Binance could cause panic. And mass withdrawals by customers, causing them to lose money and destabilize the entire cryptocurrency market.

Therefore, prosecutors are considering alternative options to punish Binance, such as fines, deferred prosecution, or a settlement agreement. This would avoid a harsh reaction from investors and negative consequences for the industry. A decision on what charges will ultimately be brought against Binance has not yet been made and is under review by the US Department of Justice.

Prospects

Our experts note that despite the local recovery, buyers failed to gain a strong foothold above $30 th. The price Bitcoin stabilized around $28,950, where it traded until the end of the week amid the absence of positive triggers. The key support level is the $28,250 mark. If the trend line from the low of $16,333 does not hold. The risks of falling to $25,250 will increase sharply. According to seasonal cycles, the bearish phase should last until September. BitRiver estimates that Bitcoin needs to break through the resistance at $30,500 for the situation to turn bullish.

MicroStrategy has bought another 467 BTC since June 30. And at the end of July, it owned 152,800 Bitcoins

Michael Saylor’s MicroStrategy may raise up to $750 million by selling its shares to three companies. And the proceeds may be used, among other things, to buy Bitcoins. And this is what the company said in a statement filed with the U.S. Securities and Exchange Commission (SEC) on August 1.

“As with previous programs, we may use the proceeds for general corporate purposes. And which include the purchase of bitcoins and the repurchase or repayment of our outstanding debt,” the company clarified.

MicroStrategy bought another $361.4 million worth of Bitcoins in the second quarter of 2023. And what was the largest coin purchase by the company since the cryptocurrency’s price peak in late 2021. Since June 30, the company has purchased an additional 467 coins. This brings the total value of Bitcoins held by the company to about $4.53 billion. As of July 31, the company owned 152,800 BTC.

Our experts note that the company purchased between April 29 and June 27 at an average price of about $28,136 per 1 BTC. Additionally, another 12,333 bitcoins for a total of $347 million.
This purchase brings the total number of Bitcoins held by the company to 152,333 BTC, which is approximately $4.6 billion at the exchange rate at the time of publication. The company paid a total of about $4.52 billion for these bitcoins, with an average purchase price of about $29,668 per 1 BTC, including commissions and other expenses.

Our experts have told us what events. And market factors could lead to the beginning of a more noticeable change in the price of Bitcoin

Bitcoin (BTC) exchange rate has been in the range of $29-31 thousand since the end of June. And in case of short-term price changes, it quickly returns to its previous values.

According to Glassnode, a huge number of Bitcoins changed hands in the range of $30,400 to $31,100. Due to this, the Bitcoin price has formed strong resistance levels that will not be broken without significant fundamental triggers in the next few days.

The current period of consolidation of the cryptocurrency price is primarily due to the market’s expectation regarding the denouement of the Bitcoin-ETF story. And uncertainty about the US Federal Reserve policy and interest rates.

On the one hand, based on the 30-day federal funds rate data, there is a 99.8 percent probability of a rate hike. And what is traditionally a bearish signal for the market. On the other hand, analysts are expecting very soft rhetoric from Jerome Powell regarding further rate hikes. And there is a probability that he will announce the current rate hike as the last one in this cycle. In that case, we can expect a bull rally for Bitcoin as well as other cryptocurrencies.

Also, anytime before August 12, we may get news on the SEC’s decision on Bitcoin-ETF applications by BlackRock and other investment funds. If the applications are approved, Bitcoin could “fly” to $35-40k. But if they are rejected or returned for revision, the price will most likely return to the $27-28k levels.

BTC exchange rate seems to have frozen up

The main reason Bitcoin is stagnating is the lack of bullish momentum. To overcome the $32.5k mark and consolidate above it. Now Bitcoin lacks the inflow of institutional money. And this inflow is hindered by the lack of clear and precise regulation.

Bitcoin’s noticeable growth stopped at the end of June. And since then, the main cryptocurrency has been hovering around $30 thousand for a whole month. This was the case until recently, when several notable events occurred in the crypto market. First, Ripple won a partial victory in court against the SEC. Second, there was the collapse of the dollar in the global currency market. All this, of course, affected the growth of interest in Bitcoin.

Today it continues to trade at the same level, but in the near future it will begin a steady, albeit small growth. Some analysts make predictions based on the 200-day moving average indicator (MACD). And they forecast its reaching the value of $32 th. at the moment of halving. Our experts think that this is quite a balanced position. And it is unlikely that by the halving the indicator will exceed this value by more than 50%. At this point, our experts see a price opportunity between $40k and $50k (most likely $47k).

The launch of the Bitcoin ETF could boost daily demand for bitcoins by $100 million, analysts predicted

The price of Bitcoin (BTC) can grow by 521% from current values to $180 thousand before the planned April 2024 halving. This is reported by Business Insider with reference to the data of the research company Fundstrat.

Now the daily demand for BTC in the amount of about $25 million is equivalent to the daily reward for mining in the amount of about $25 million. But the situation may change in the case of the launch of the Bitcoin-ETF, the analysts of the company believe.

In their opinion, Bitcoin funds can increase the daily demand for BTC by $100 million. Such growth taking into account the halving in April 2024. And which will reduce the daily reward for mining to $12 million. It means that the price of BTC must grow significantly for an equilibrium between buyers and sellers to be reached.

In July, NYDIG analysts said that spot Bitcoin-ETFs will provide demand for cryptocurrency for $30 billion. Experts came to this conclusion after the largest management companies submitted applications for the launch of such funds.

Our experts note that at the same time, Bloomberg senior analyst Eric Balchunas believes. That the approval of applications for the launch of spot exchange-traded BTC funds (ETFs) in the United States will open the bitcoin market access to capital of $ 30 trillion.

This is the approximate amount of assets controlled by US investment firms that have applied to launch Bitcoin-ETF funds

The approval of applications to launch spot exchange-traded Bitcoin-ETF funds  in the U.S. will open the Bitcoin market to $30 trillion in capital, Bloomberg senior analyst Eric Balchunas told Cointelegraph.

This is the approximate amount of assets controlled by US investment firms. And which have filed applications to launch such products with the Securities and Exchange Commission (SEC). These include BlackRock, Fidelity, Invesco, Bitwise, ARK Invest, WisdomTree, 21Shares, VanEck and Valkyrie.

Also according to Balchunas, older investors and financial advisors often place investments with ETFs. Exchange Traded Bitcoin funds will provide access to the cryptocurrency without having to buy it directly.

The analyst believes that the participation of BlackRock, the world’s largest asset manager. Is enough to increase the chances of such products being approved from 1 percent to 50 percent.

Our experts note that cryptocurrency trading volumes rose in June for the first time in three months. The optimism of crypto traders is specifically due to BlackRock’s filing of an application to open a bitcoin exchange-traded fund (ETF). Also the total volume of spot and derivative trading on centralized exchanges increased by 14% to $2.71 trillion.

Our experts have assessed how realistic the forecast from Standard Chartered looks. And what we can actually expect from the price of the first cryptocurrency

Bitcoin (BTC) may reach $50 thousand this year and $120 thousand by the end of 2024. This was stated in a recent report by analysts at Standard Chartered. The bank back in April published a Bitcoin price forecast for the end of 2024 – $100 thousand, explaining that the crypto winter is coming to an end. One of the bank’s leading currency analysts, Jeff Kendrick, says that now 20 per cent should be added to this forecast.

Standard Chartered is a large British bank with operations around the world. The company’s assets, according to Forbes, amount to $820.7bn. Standard Chartered has a network of 1.2 thousand branches in more than 70 countries.

A conservative enough scenario

We believe this scenario is quite realistic given the approaching halving in April 2024 and the inflow of capital into the crypto market by large investment funds such as BlackRock and Fidelity Investments.

Bitcoin will gradually rise to the $50k level. But the really noticeable growth is expected in mid-August. And when the first deadline of the Securities and Exchange Commission (SEC) on the Bitcoin-ETF decision will pass. Growth could then continue into September and October. And when, according to many analysts, the Fed’s rate hike cycle will end. And already next year, on the background of halving, the price of BTC, quite probably, can reach the mark of $100-120 thousand.

The market has been in a state of consolidation for several weeks. And the BTC rate is fluctuating around $30,500. The nearest important events that can affect the market are reports on the consumer price index (CPI). And producer price index (PPI) in the U.S. on 12 and 13 July, respectively, which may affect the Fed’s rate decision.

Our experts note that the meeting itself will be held on 26 July. Both experts and traders are already confident in raising the current rate from 5.25 to 5.50%. And that could potentially cause a slight correction in the Bitcoin rate.

Our experts have analysed the market situation and outlined how it could change in the short term for Bitcoin

The week from 3 to 9 July was quite peaceful for the Bitcoin market. The price of the cryptocurrency fluctuated between $29,800 and $31,500. Significant volatility was seen on Monday (3 July) and Thursday (6 July). On these days, buyers tried to overcome the resistance level in the range of $31,400 to $31,500, but failed to succeed.

At the beginning of the week the price reached $31,380. However, due to the Independence Day celebrations in the USA on the 4th of July, a corrective movement was seen in all markets. Which lasted until the publication of the minutes of the US Federal Reserve (Fed) meeting. The correction of the BTC/USDt pair was temporary and the price recovered to $31,500 from $30,200.

The minutes of the Fed meeting showed that interest rates remained unchanged. But raised expectations of a possible increase at the next meeting. This was one of the reasons for Bitcoin’s price fluctuations.

The growth of the dollar index and the fall of stock indices forced many investors to close long positions due to concerns about the U.S. economy. A correction started from the $31,500 level. The US private sector employment report released by ADP. And showed a stronger increase in private sector jobs by 497 thousand in June than expected. The data indicated that the US labour market remains strong despite the Fed’s tightening of monetary policy. They raised investor concerns about a possible more aggressive tightening of the Fed’s monetary policy.

Opportunity for growth remains

The US Department of Labour reported that data on non-farm payrolls for June showed the addition of 209 thousand jobs. And while the forecast expected the addition of 225 thousand jobs. This led to the weakening of the US dollar. The unemployment rate was 3.6% compared to the previous reading of 3.7%. And average hourly earnings rose 4.4% year-on-year, up from 4.2% in the previous month, adding to inflationary pressures.

According to CME Group, there is a 93% chance of an interest rate hike of 25 basis points to 5.25-5.5%. A rate hike favours a stronger local currency. Given that the market has already taken this hike into account, we can expect the dollar to decline further after the announcement of the US Federal Reserve’s decision.

Next week, special attention will be paid to inflation indicators in the US after the publication of labour market data. The consumer price index (CPI) for June is expected to rise by 0.3% month-on-month. And the annualised rate is expected to fall from 4.0% to 3.1%. The core CPI is also expected to decline from 5.3% to 5.0%.
Our experts believe that there is still room for Bitcoin price to rise to the $34k level, which represents the target zone.