3 Reasons Bitcoin (BTC) Could Bounce This Month: Details

TL;DR

Despite the recent volatility, several indicators suggest that BTC may be entering a bullish phase. On the other hand, an essential element points to an intensified short-term pullback. ‘Uptober’ Still On The Cards?

Bitcoin (BTC) has been through a lot of volatility since early October, performing worse than some expected. After all, the current month has been a historically positive period for the entire cryptocurrency industry, known to the community as “Uptober”.

BTC is currently trading south of $61,000, down 5% on a 10-day scale. However, some key metrics suggest a resurgence could be on the horizon.

BTC Price, Source: CoinGecko

According to CryptoQuant, BTC exchange outflows have mostly outpaced inflows over the past week. As seen in the chart below, the last few days witnessed the appearance of huge red candles, indicating a potential shift away from centralized platforms towards self-custodial methods. This could be seen as a bullish sign as it reduces immediate selling pressure.

BTC Exchange Netflow, Source: CryptoQuant

Next on the list is the BTC MVRV (Market Value to Realized Value), which recently fell below 2. Readings below this mark usually indicate that the market is in a build-up phase, which indicates potential buying opportunities.

Last but not least, we’ll talk about Bitcoin’s Relative Strength Index (RSI). The momentum oscillator, which measures the speed and change of price movements, approached the bullish zone of 30 on October 9 and is currently around 38. For now, the signal shows “close to shopping”.

Something for the bears, too

Contrary to the aforementioned factors that suggest a possible price recovery, there is a hint of the opposite scenario. According to X user Ali Martinez, this is the surge in whale activity that has sold or redistributed 30,000 BTC in the last 72 hours (which equates to nearly $1.9 billion).

The development increases the circulating supply of the primary cryptocurrency, which could lead to a sinking valuation (assuming demand doesn’t keep pace).

Also, actions by such large investors can cause panic among smaller players, causing them to dump their holdings and hasten the withdrawal.

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