Originally published on: September 29, 2024
As Bitcoin’s price inches closer to the $64,406.49 mark, investors are eagerly awaiting a potential bullish engulfing pattern that could signal a significant market trend. However, recent indicators suggest a potential slow start to what some are calling “Uptober.”
The Impending Bullish Engulfing Pattern and Market Trends
Bitcoin’s monthly price chart is on the verge of completing a bullish engulfing pattern, a rare occurrence that last took place in January 2023. This pattern historically marked a bearish bottom, indicating potential positive momentum for the cryptocurrency market.
While the long-term outlook for Bitcoin in Q4 and early 2025 appears optimistic, recent signals hint at possible downside volatility in the short term. Following a local bottom near $52,150 in September, Bitcoin has experienced a rapid uptrend, surpassing previous resistance levels.
Increased open interest in Bitcoin futures, reaching $35 billion on September 27, suggests significant market participation in price movements. Concurrently, the funding rate remains relatively flat, indicating indecision among perpetual traders.
Spot Orderbook Depth and Market Sentiment
Spot traders are currently active in selling around the $66,000 resistance level, highlighting bearish sentiment in the market. As observed by independent trader Adam, the spot orderbook depth leans towards the sell side, suggesting a bearish bias among traders.
Potential Market Corrections and Support Levels
From a technical standpoint, a short-term correction may be in store for Bitcoin as it forms a higher low pattern. A bearish divergence between price and the relative strength index (RSI) on the 4-hour chart indicates a possible correction towards $62,300, a decline of approximately 4.66%.
Should the correction continue, the next support range lies between $59,500 and $61,000, aligning with key Fibonacci levels and EMA indicators. A daily close below $60,000 could jeopardize the current bullish momentum, leading to further market uncertainty.
Invest Wisely and Conduct Research
This analysis serves as an informative overview of potential price movements in the Bitcoin market and does not constitute investment advice. Investors should conduct thorough research and due diligence before making any trading decisions to mitigate risks associated with market volatility.
Stay informed, stay cautious, and make informed investment decisions in the ever-evolving cryptocurrency landscape.
