This week I want to touch upon the possibility of a Q4 rally in crypto, especially since the market is showing on and off-chain signs that a large up move could be upon us.
Typically, when we see the price struggling to make lower lows or getting bought up on price dips it hints that the downside is close to being done from at least a medium-term perspective.
I think the key is what will cause the rally, especially since Bitcoin is basically trapped in a pretty price range, and very promising altcoins, such as Chainlink, failed to break out of their long-term range highs this week.
Source: Tradingview.com
The overall improvement of the global economy, as referenced by the latest U.S. jobs report, could lead to the Fed’s possible pivot from its anti-inflationary policy which could lead to a Bitcoin rally.
The central bank of the United States has two more FOMC meetings until the end of 2023, where it will decide whether the time for reducing the record interest rates has come.
Regulatory developments are also a significant factor for Bitcoin and crypto. It is safe to say that the majority of governments across the world have so far failed to impose a comprehensive regulatory framework on cryptocurrencies.
The U.S. is undoubtedly amongst those where the SEC has caused much controversy with its actions. A possible approval of a spot Bitcoin ETF could change the trends and indicate that the industry has a huge advancement potential in the world’s largest economy.
We are likely to get more news towards the latter part of next week as a number of ETF decisions and deadlines come to pass.
On the on-chain front, there have been a number of very positive developments such as the total collapse of retail traders.
Source: Santiment.net
This is something I have been waiting for this year in fact before a real rally could ensure. History, poor market timing by retail traders has been a leading indicator for pending price trends.
Why would they be selling ahead of coming ETF approvals and the halving event after holding BTC all year or even from the 2022 highs.
This week massive exchange movement was seen on exchanges, with massive wallet transfers. This is another classic sign to look out for before rallies.
Source: Cryptoquant.com
Next, I would be looking for a multi-year outlier spike in Token Age Consumed and increased whale movement to confirm my hunch that Q4 could be the month BTC breaks out.
Can BTC reach $40,000 by year-end? Very possibly if the ETF approvals start to get baked into the price or priced in by the market it's a sure thing.
Source: Tradingview.com
Technically, BTC is making all the right moves above its yearly pivot point, at $26,800. The next big breakthrough for BTC will multi-daily closes above $28,400.
This may greenlight a technical test of $31,000.More so than anything, $31,000 is the most important upside level on the BTC daily chart.
Mark my words, two or three daily closes above this level and BTC will test $35,000. Let's see what October brings.
