Bitcoin Stabilizes Near $34,000 Amid ETF Approval Anticipation and Fluctuating US Dollar Strength
Summary:
Post Wall Street opening on October 24, Bitcoin (BTC) held steady near $34,000 following a 15% daily surge. The BTC/USD pair volatility hovered around $34,000 for the day amid expectations of a Bitcoin Spot Price exchange-traded fund (ETF) approval in the US. There was a strong resistance at the levels of $30.5k, $31.5k, and $33k, however, these were eliminated when an $87M buy wall appeared at the $30.6k level. Bitcoin's consolidation came concurrently with a surge in the U.S. dollar, displaying mixed reactions. Notably, any trading or investing moves carry inherent risk and should be backed by thorough research.
After the Wall Street doors opened on October 24, Bitcoin (BTC) remained stable close to $34,000, following a significant 15% increase in its value within a day. The BTC price kept fluctuating around this figure throughout the day, as per the information provided by Cointelegraph Markets Pro and TradingView. The cryptocurrency had previously reached a 17-month high of around $35,200 due to the burgeoning anticipation surrounding the possibility of a Bitcoin spot price exchange-traded fund (ETF) gaining approval in the US.
Material Indicators, a monitoring resource, identified a shift in the support/resistance (R/S) at $30,600 in the chain of events leading to a $5,000 daily candle. The swiftness with which the market overcame resistance, which had stayed consistent for approximately a year and a half, was unexpected. The resource had anticipated stronger resistance at the levels of $30.5k, $31.5k, and $33k, but these were easily overcome, particularly when a $87M buy wall appeared at the $30.6k mark, laying the groundwork for an R/S flip without any retaliation from the market. After the $32k level was breached, some of the liquidity overhead was removed, paving the way for a sharp increase to $35k for BTC.
The likelihood of a potential pullback was also mentioned due to some bid liquidity being withdrawn. Factors like exchange funding rates, which were well within the positive zone at the moment, could also contribute to deeper consolidation. According to CryptoBullet, a renowned trader, a disproportionately positive funding indicates that most traders are long. Such a circumstance usually indicates that the market maker will have to wipe the late longs out, as the majority is seldom correct.
On October 23 and 24, BTC short liquidations were $161M and $48M respectively as per CoinGlass, a monitoring resource. Trader Daan Crypto Trades commented that the market might maintain its direction, as sustained positive funding rates are a common trait of a bull market.
The price recovery of Bitcoin coincided with a resurgence in the strength of the US dollar, which had decreased the previous day. The interaction between Bitcoin and the US dollar index (DXY) has been varied, despite a once apparent clear inverse correlation. Macroeconomist James Stanley pointed out that the Personal Consumption Expenditures (PCE) data set to be released on October 26 holds the key to DXY in the short term. This will be followed by a Federal Reserve meeting on November 1 to decide on interest rate policy.
Please note, this article offers no financial advice or recommendations. It's important to conduct personal research and assess the risks before making any investment or trading decision.
Published At
10/24/2023 2:46:47 PM
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