All Time High Ending The Week – 5 Things To Watch For Bitcoin This Week

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Bitcoin (BTC) simply refuses to die this week as a dip below $ 60,000 takes barely an hour and bears are being burned again.

After a fairly quiet weekend, a typical drawdown occurred on Sunday October 17th before a dramatic rebound for BTC / USD took place just an hour later.

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Bitcoin has not only maintained its bullish course, but also sealed its highest weekly close of all time – around $ 61,500.

As the market prepares for a possible start of trading for the first exchange-traded Bitcoin funds (ETF) in the US, volatility is as good as guaranteed, analysts say.

Cointelegraph takes a look at five things to consider the week that BTC / USD hits an all-time high and institutional access takes a historic leap forward.

Bitcoin gives less than an hour to buy the dip

Just when it looked like the run at all-time highs had hit a stumbling block, Bitcoin surprised everyone again overnight.

After losing $ 60,000 late Sunday, the bulls had no time for BTC price weakness, and before BTC / USD even hit $ 59,000, they embarked on an aggressive buying frenzy.

Hours later, the pair was back above not just $ 60,000 but also $ 62,000 – and was staying there at the time of writing.

The episode didn’t even affect Bitcoin’s weekly close, which despite its volatility was still its highest ever – around $ 61,500.

“The historic weekly end now means that BTC is well positioned for a further upward trend,” summarized the trader and analyst Rekt Capital on Monday.

He added that the next phase of BTC price action will be “more volatile” than in the previous bull market years of 2013 and 2017.

BTC / USD 1-week candle chart (Bitstamp). Source: TradingView

As various analysts celebrate the weekly closing milestone, the imminent opening of the US market could also cause a stir.

On Monday, October 18, the very first Bitcoin ETF products could launch with the blessing of U.S. regulators as BTC / USD is less than $ 3,000 away from new all-time highs.

On the derivatives issue, funding rates on the stock exchanges have also cooled since last week, easing concerns about an unsustainable uptrend leading to a blow-off top.

Bitcoin Funding Rates Chart. Source: Bybt

ETFs are “go”, but not for everyone

Love it or hate it, this week is all about the Bitcoin ETF.

When rumors of a green light on U.S. regulation began circulating late last week, Bitcoin price action heated up – and the trend is likely to continue this week.

After years of rejection, the US Securities and Exchange Commission is preparing to launch two ETF products, both based on CME Group’s Bitcoin futures.

These precede a lengthy decision-making process that begins next month regarding physical Bitcoin ETFs – those with actual BTC as an underlying and which are the topic of real interest to analysts.

There is no guarantee that these traditional ETFs will be approved and there are already concerns that the market could be disappointed again.

Since several applications have to be decided, there are still six months until the breakthrough of the SEC.

Bitcoin ETF approval schedule. Source: Arcane Research

Optimism that the tide will turn in the crypto industry’s favor continues this week as Grayscale confirms it will file for the conversion of its flagship Bitcoin fund product into an ETF.

Grayscale’s fund, the Grayscale Bitcoin Trust (GBTC), has been the topic of conversation itself in recent weeks and has been trading at an increasing discount to recognize BTC amid fears that institutional clients will vote with their feet in advance of the ETF launch.

The former’s higher fees are an example of the competitive advantage debate, while some have suggested that futures-based ETFs, by definition, are not a viable alternative.

“First of all, most institutional players have direct access to CME futures. The main reason they would choose to trade ETFs instead of futures would typically be to avoid tracking error (versus the spot price) from futures roll costs or price variances from contango or backwardation, ”added crypto trading firm QCP Capital in a circular to Telegram added channel subscribers Friday.

“The ETF based on CME futures nullifies the fundamental advantage of ETFs; in order to follow the spot price as closely as possible. “

Difficulty level for a seventh ascent in a row

Bitcoin network fundamentals continue to impress this week, and troubles are at the fore.

Arguably the most important characteristic of Bitcoin is getting stronger and stronger and will seal a seventh increase in a row on Tuesday, October 19th. The last time was in 2019.

For the first time since June, that surge will go back to over 20 trillion.

Bitcoin 7-day diagram for the average level of difficulty. Source: Blockchain.com

It does this despite some hash rate volatility, with estimates now dropping back to 123 exahashes per second (EH / s) and hitting over 140 EH / s this month.

However, with the general uptrend still intact, there is little concern given the news that the US is now home to the lion’s share of Bitcoin mining power.

Supply shock predicts a “good year” for 2022

While Bitcoin price predictions focus on what could be possible in the fourth quarter of this year, some are already looking into the distance – and using data to reach even more bullish conclusions.

One analyst who paints a rosy picture for 2022 is Willy Woo, creator of the Woobull data resource and known for his Bitcoin market cycle research.

Over the weekend, Woo highlighted the increasing scarcity of Bitcoin as the likely fuel for ongoing price pressures.

In the past, he found that a decreasing supply combined with a larger proportion of that supply that remains in the hands of traders who have no sales plans creates a strong upside signal.

His “Long Term Holder Supply Shock” metric clearly shows such a scenario that has played out several times in the history of Bitcoin.

“The technical name for this diagram is ‘2022 will be a good year'”, he summarized Twitter followers.

Supply shock chart for long-term Bitcoin holders. Source: Willy Woo / Twitter

As Cointelegraph reported, long-term owners already control a near-record-breaking proportion of the BTC supply, leading to the expectation that the battle for the remaining coins will be hotter than ever.

This should be supported if a physical ETF is approved, which will happen as early as November and could last for several months.

The BTC balance tracked by CryptoQuant on the most important exchanges has leveled off at just under 2.4 million BTC after a steep decline in September.

The next bitcoin bear market is coming

With so much excitement about the potential Bitcoin price high this year and how high it could be, some analysts are already turning to the downside – the bear market.

Related: Top Five Cryptocurrencies You Should See This Week: BTC, ETH, SOL, MATIC, FTM

Historically, nothing goes straight up, and Bitcoin is no exception. Each halving cycle has reached a price high in the year after the block subsidy was halved, followed by a price low in the middle of the cycle.

This cycle, several well-known market participants claim, will be no different.

A price spike is followed by an extended comedown, in line with both 2014 and 2018.

Still, for popular Twitter analyst TechDev, that floor should be an order of magnitude higher than the last one – up to $ 60,000 – but the process should begin as early as the end of 2021.

“I want an extended cycle. Who would not do that? But nothing I’ve seen in relation to macro PA suggests it will happen, ”he warned his followers over the weekend.

“Watch your indicators. 2 week RSI channel, RVI 92-93. If they get hit, I’ll be out. Ignore them in the hope of a new paradigm and you will likely be dumped by those who don’t. “

Of several accompanying charts, one neatly showed how Bitcoin’s relative strength index neatly captured every peak over the two-week period.

BTC / USD annotated chart with RSI peaks highlighted. Source: TechDev / Twitter

Twitter colleague Rekt Capital also took the opportunity to remind followers and subscribers of the need to time profit-taking.

“People think that BTC will never see a -80% bear market again because it is now mainstream and an over-mature asset,” he argued.

“Let’s not forget that a few months ago there was a correction of -53%. The average bear market is -84.5% low. It is very likely that one will step in after this bull market. “

The weekend still delivered an optimistic forecast for the bear market, with Dan Morehead, CEO of Pantera Capital, claiming the bottom was “shallower” than the others.

As Cointelegraph reported, other measures are watching the good times to continue through 2022, even for Bitcoin. Earlier this month, PlanB, creator of the stock-to-flow-based Bitcoin price prediction models, announced that the bull run would be at least six more months.