Bitcoin Price Rebounds to Highest Level Since July

Bitcoin (BTC), the original cryptocurrency and largest by market cap, has continued its strong rebound, rising for three consecutive days to reach its highest level since July 29. The cryptocurrency retested the psychological level of $68,000, marking a nearly 40% increase from its lowest point in August.

Market Sentiment and Technical Indicators

The odds of Bitcoin continuing its upward trajectory are increasing. The crypto fear and greed index moved from a greed zone of 37 last week to 58. Historically, BTC and other cryptocurrencies tend to rally when market sentiment shifts toward greed.

Additionally, Bitcoin has formed a golden cross pattern, where the 50-day and 200-day Weighted Moving Averages (WMA) have made a bullish crossover. The WMA is often considered a superior type of moving average compared to simple and exponential moving averages because it gives more weight to recent movements, smoothing out data more effectively.

The last occurrence of this bullish crossover was on October 23 of the previous year, after which Bitcoin surged by 120% to its all-time high of $73,800 in March. Bitcoin has also formed an inverse head and shoulders pattern and flipped the important resistance point at $66,561, its highest swing on September 27. It also crossed the descending trendline that connects the highest swings since March.

Factors Driving Bitcoin’s Rise

Bitcoin’s rally can be attributed to two main factors. First, the odds of Donald Trump winning the upcoming election have risen, with Polymarket placing his probability at 60%. Trump is considered favorable for the crypto industry due to his strong endorsement of the sector. He is a crypto owner with a portfolio worth over $6 million and has launched a crypto project, World Liberty Financial.

Studies show that Trump’s policies, including tax cuts, defense spending, and tariffs, could lead to a $7.5 trillion deficit over a decade. Given the U.S. public debt has already jumped to over $35.5 trillion, investors view Bitcoin as a better alternative to the U.S. dollar because of its capped supply of 21 million coins.

Polymarket’s odds of Bitcoin reaching a record high have risen to 70%.

Analyst Predictions

Market analysts are optimistic about Bitcoin’s future. Peter Brandt, a well-known trader with over 740,000 followers, predicted that Bitcoin has more upside potential, with an initial target of $73,800, its all-time high. Brandt noted that “an inverted expanding triangle has about a 50% chance of working all the way to a measured target.”

If you say, ‘50% only, then what benefit are charts,’ then you should probably not trade because you lack nuanced understanding of timing and asymmetry between reward and risk.

Other analysts have also delivered positive forecasts. Miles Deutscher predicted that the next Bitcoin breakout will be much bigger than most expect, driven by the fear of missing out. Michael van de Poppe sees more long-term upside as the Federal Reserve cuts interest rates.

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