Bitcoin (BTC) could not break the the so-called curse of September, with its price falling a little more than 7% in the month despite a strong rebound of recovery just before its closing. However, Bitcoin seems to be making a comeback in October, a month known for painting aggressive bullish reversals.
Bybt data shows that Bitcoin has closed October with gains most of the time since 2013, with a success rate of more than 77%. Last year, the cryptocurrency surged 28% to hit levels above $ 13,500 after ending September at around $ 10,800, following an approximate 7.5% decline.
Similarly, Bitcoin was up more than 10% at the end of October 2019 despite falling around 14% the previous month. That made September seems like a liquidation month for traders, with their logging loss record seven out of nine times since 2013.
By contrast, October was featured as a dip buying period, suggesting that traders may end up raising the price of Bitcoin by October 31st.
Furthermore, the prospects of the Federal Reserve limiting its $ 120 billion a month bond purchase program At the end of this year, it appears to have been limiting the bullish outlook for Bitcoin. Loose monetary policy, combined with near-zero interest rates from the US central bank, was instrumental in pushing the price of Bitcoin from below. $ 4,000 in March 2020 to almost $ 65,000 by April 2021.
But despite short-term setbacks, a number of key indicators reveal that investors still want exposure in the burgeoning crypto space.
CryptoCompare Cryptographic Data Tracking Service indicated in its report that the volumes associated with investment products in digital assets increased by 9.6% in September. Meanwhile, weekly product entries rose to $ 69.7 million, the highest since May 2021.
“Bitcoin-based products saw the highest level of inflows of any asset, averaging $ 31.2 million per week,” CryptoCompare wrote, adding that “there could be advantages in the final quarter of 2021.”
The 20-week EMA fractal
Technical indicators also pointed to a bullish session ahead for Bitcoin when it formed a base around $ 40,000 before the end of September and recovered key resistance levels as interim support. That included the 21-week exponential moving average that defines the bias (21-week EMA).
As Cointelegraph previously covered, a drop below the 21-week EMA increased the likelihood of Bitcoin continuing to decline by 78%. On September 27, the cryptocurrency fell below the green wave (as shown in the chart below) but regained it as support upon entering the October session.
A move above the 20-week EMA, accompanied by rising volumes, has historically led to explosive bull runs on Bitcoin. As a result, if the fractal repeats, the price of BTC may go up towards a new record in the coming weeks.
Bull pennant break
Another technical indicator that has been predicting a bullish result for Bitcoin is the bullish pennant.
In detail, the price of BTC has been consolidating within two converging trend lines following its rally of more than 500 percent.
Traditional analysts see these sideways movements as a bullish continuation signal. In doing so, they anticipate that the price will break above the pattern’s upper trend line and rise by as much as the length of the previous uptrend, called the flagpole.
As a result, Bitcoin’s path of least resistance appears to be to the upside, with a possible breakout move looking to send its prices toward $ 100,000 (the height of the flagpole is roughly $ 50,000).
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every trade and investment move involves risk, and you should do your own research when making a decision.