Key Highlights
- On Monday, Bitcoin's trading price was approximately $86,000, just shy of the $87,354 peak that has been a barrier for its gains.
- The macroeconomic environment is becoming more favorable for Bitcoin, with potential positive triggers on the horizon.
- Recent charts indicate a bullish trend as Bitcoin has achieved a second, more pronounced "golden cross."
Bitcoin has kicked off the week on a positive note. While it has yet to surpass its resistance level, there is a sense of optimism among investors.
On Monday morning, Bitcoin was trading around $86,100, reflecting a 1.14% increase over the past 24 hours, resulting in a market cap of $1.73 trillion. In total, the cryptocurrency market is valued at $2.94 trillion, up 1.36% for the day, with the Fear & Greed Index at 68, indicating a state of "greed" and a recovering sentiment after a previous dip from “extreme greed” levels last month.
Myriad: Predict Bitcoin's next peak! Click here.The catalyst for this movement was the discouraging jobs report released last Friday. According to the Bureau of Labor Statistics, U.S. employers created only 29,000 jobs in September, significantly lower than the anticipated figures. Additionally, the unemployment rate rose to 4.2%.
Revision of previous data further exacerbated the situation, with July's job gains revised from 21,000 to a loss of 10,000, and August's figures adjusted from 162,000 to 133,000. Annual wage growth also slowed to 3.0%.
While this data is negative for workers, it tends to be favorable for risk assets, a peculiar dynamic in this economic cycle.
Bitcoin price data. Image: TradingviewOn September 16, the Federal Reserve raised interest rates by 25 basis points to a range of 3.75%-4.00% in a unanimous decision. Prior to the jobs report, bond traders estimated a 64% likelihood of another rate hike in October, but those probabilities have since dropped to approximately 16%-22%.
This situation contrasts sharply with last month when a strong jobs report on September 4 caused Bitcoin to fall over 2% to nearly $79,300 as expectations for rate hikes increased. Currently, Bitcoin is trading about 8% higher than that mark.
The stock market also reacted positively, with the S&P 500 closing at 7,722.72, up 0.73%, the Nasdaq rising 1.19% to 27,190.86, and the Dow increasing by 0.49% to 51,176.96. Nvidia reached a new record high, and stock futures showed upward movement on Sunday night.
In the altcoin market, Ethereum was priced at $2,711, up 0.59%, while XRP increased by 0.81% to $1.51. Solana saw a slight decline of 0.91%, trading at $120.31. Most of the top ten altcoins experienced gains, albeit modest ones, with Hyperliquid leading the pack with a 3.68% increase to $93.17 for the day and a 6% rise over the week.
Interest in ETFs remains strong, with U.S. spot Bitcoin ETFs reporting $189.84 million in net inflows recently, bringing total net assets to $101.1 billion, as per data from Decrypt.
Bitcoin ETF net flows. Image: DecryptBitcoin Price: Facing Resistance but Gaining Momentum
The daily chart illustrates the current resistance, with the $87,354 mark being crucial for Bitcoin's progress.
Momentum indicators show strength; the Relative Strength Index (RSI) sits at 64.7, indicating a strong trend without being excessively overbought. The Average Directional Index (ADX), which assesses trend strength, is currently at 43.4, indicating a strong trend.
Exponential moving averages (EMAs) are also noteworthy; a golden cross occurs when a shorter EMA surpasses a longer one. The current chart shows the 50-day EMA above the 200-day EMA, marking a classic golden cross. This event took place in mid-September, when Bitcoin experienced its second-best monthly performance.
Moreover, an even stronger indicator has emerged, as the 100-day EMA has now crossed above the 200-day EMA. This is visible in the chart, with the 100-day EMA represented by the dotted white line.
Why does the 100/200 cross carry more weight? It indicates a more sustainable upward trend, as maintaining the price above the $60,000 threshold for several months is necessary for this to occur, reflecting a robust rebuilding of Bitcoin's medium-term trend.
Both crosses suggest that short-term and medium-term averages are now above the long-term average, reinforcing the bullish sentiment. However, it's important to note that EMAs are lagging indicators; thus, a golden cross confirms a prior movement rather than predicting future trends.
On Myriad, a prediction market associated with Decrypt's parent company Dastan, traders are optimistic about a short-term rally. In the October highs market, there is an 80% chance of Bitcoin hitting $87,500, a 59% chance for $90,000, a 25% chance for $95,000, and a 12% chance for $100,000.
Looking ahead, the upcoming economic calendar is brief but significant. The Fed will release the minutes from its September meeting on Wednesday, October 7, at 2:00 p.m. ET, while the Bureau of Labor Statistics will publish the September CPI on October 14. The Fed's next policy meeting is set for October 27-28, with a press conference scheduled for October 28 at 2:30 p.m. ET.
Disclaimer
The opinions expressed by the author are intended for informational purposes only and do not represent financial or investment advice.