Bitcoin (BTC) is still in a bullish reversal when looking at this year’s price chart. Bitcoin’s price has risen 70% after bottoming at around $16,800 in November 2022, defying fears of interest rate hikes as optimism grows over the approval of ETFs.
However, in recent months, Bitcoin bulls have failed to keep the price of Bitcoin above $30,000. So, with the “bullish” halving still more than 200 days away, many traders are wondering: Will the price of Bitcoin rise again in the coming months?
Let’s take a closer look at possible scenarios as the third quarter comes to a close.
The Fibonacci fractal indicates that Bitcoin will collapse to $21,500
From a technical point of view, Bitcoin price stabilized around the 0.236 Fibonacci line on the Fibonacci retracement chart drawn from the swing high of $69,000 (market top) to the low of $15,900 (local market bottom).
The flat BTC price action looks very similar to that seen during the 2018 BTC price correction.
In 2018, BTC/USD settled around the 0.236 Fibonacci line at around $6,790 for several months before falling around $3,000 in December. The $3,000 level coincided with what is now known as multi-year uptrend line support (identified as bear market support in the chart above).
Bitcoin is now repeating what it was in 2018 already halfway through with prices stabilizing at the 0.236 Fibonacci line. A breakout from this level means that Bitcoin price will see $21,500 as the next major support level, down 17.75% from current levels.
A strong dollar adds to the downside risks for Bitcoin
Meanwhile, the US Dollar Strength Index (DXY), which measures the strength of the US currency against a group of major foreign currencies, reached its highest level since November 2022.
The index has been negatively correlated with Bitcoin throughout 2023, as shown below.
The dollar’s advance accelerated following the Fed’s interest rate decision last week, and the DXY is currently charting its 11th consecutive green weekly candle.
In other words, Bitcoin’s bullish prospects may be limited if the dollar continues to rise after the DXY golden cross.
Are “old” Bitcoins being sold?
Bitcoin on-chain metrics paint a mixed outlook.
The Bitcoin Destructive Day (CDD) metric, which measures the actions of long-term investors, rose on September 19, indicating that some long-term BTC holders moved their coins, indicating potential profit-taking or repositioning.
Traders should be careful here as most CDD rallies have historically preceded price declines.
On the other hand, Bitcoin reserves across all cryptocurrency exchanges continue to decline, indicating increased holding behavior among investors.
What Bitcoin Trading Analysts Are Saying
Bitcoin analysts are also divided on where the price of BTC may head in the coming months.
For example, popular trader Skew says that Bitcoin price could reach $30,000 by October, citing poor demand liquidity near $27,000, which could lead to a breakout.
Related: Bitcoin fails to recoup post-Fed losses as $20K BTC price returns to the radar
However, fellow analyst Reckitt Capital said: Not excluded Price corrected towards $18,000 based on the pre-halving fractal shown below.
“History suggests that the next 140 days will be critical for dollar cost averaging in preparation for a parabolic rise after the halving,” Rekt Capital said.
“If Bitcoin were to decline from… [the current price levels]This will likely be within the current 140-day period.”
This article does not contain investment advice or recommendations. Every investment and trading move involves risks, and readers should conduct their own research when making a decision.
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