The price of Bitcoin (BTC) is up roughly 6% from September lows, a welcomed recovery following steep losses in late August and the follow-through a few days later. The bounce could be driven by fundamental factors and optimism of price increase ahead of next year’s Bitcoin halving.
Overall, buyers are confident, but how fast the coin will surge above $28,000, aligning with gains of August 29, is yet to be seen. A breach of this liquidation level might see BTC spike to $30,000 in the medium term. On the flipside, if BTC fails to get support, further losses open up the coin to $20,000 or worse.
Eyes On Inflation, Monetary Policy
The resilience across the crypto board is despite a judge in the U.S. Bankruptcy Court for the District of Delaware permitting FTX, the bankrupt exchange, to liquidate some of their holdings, including Bitcoin, to settle its creditors.
Though they might have to seek permission before selling high-profit coins, including BTC, this was a negative development. FTX will be allowed to sell up to $100 million of assets weekly, but that limit can be increased to $200.
Bitcoin brushed off this news, and the coin rose as the focus turned to inflation readings in the United States and monetary policy status in Europe. The latest inflation data revealed that overall CPI rose while core items, including food and energy, fell slightly. The release saw BTC edge higher, floating above $26,000.
Bitcoin Price Analysis
The leg higher to spot rate is with rising volumes, evident in the daily chart. Present trading volumes are relatively high, pointing to support from traders.
As it is, primary support is at $25,200. Since the leg up is with participation, traders might look to load the dip, targeting $27,700 or August 29 highs. This expansion might draw more volumes, lifting the coin further. Subsequent breakouts confirming the bull bar of August 29 may drive BTC to $28,600 or August 17 highs in a buy trend continuation formation.
Conversely, any rejection from spot levels, pushing prices below $25,000 at the back of expanding volumes, cancels this bullish outlook. BTC will drop to June 2023 lows at $20,000 in that case.
Technical charts courtesy of Trading View.
Disclaimer: The opinions expressed do not constitute investment advice. If you wish to make a purchase or investment we recommend that you always conduct your research.
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