Following the bitcoin price surge to $64,000, cryptocurrency analyst Rekt Capital predicts a major breakout move in the coming weeks. In a new video Analysis, the analyst predicts a significant market move around October 2024, based on historical precedents and current chart patterns.
Will October be another bullish month for bitcoin?
Looking at the weekly chart, Rekt Capital identifies a bearish trend channel. Over the past four weeks, btc has been drifting below this channel, looking for support that would allow price expansion above the channel bottom. This move has been met with a “fantastic recovery,” indicating a potential return to the top of the channel around $67,000 in the coming weeks.
“The bounce off the channel bottom is crucial as it has historically taken the price from the channel bottom to the peak in about two weeks on average,” Rekt Capital explained. It highlighted the importance of weekly candle closes above specific levels, particularly at $67,500 and eventually at $71,500, which would mark a breakout of the maximum reaccumulation range established after the halving.
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“The consistent bounce pattern from the channel bottom to the top typically lasts an average of two weeks, but in the current context we are seeing a potentially prolonged consolidation phase at these lower levels,” Rekt Capital explained. This observation suggests that while the bounce path follows historical patterns, consolidation at lower prices could offer investors bargain buying opportunities.
Focusing on technical thresholds, Rekt Capital stressed the importance of several weekly candlestick closes above key price points. Firstly, a close above $66,000 would reconfirm the lower boundary of the reaccumulation range as a new support, setting the stage for further bullish movement. More importantly, a decisive weekly close above $67,500 would signify a breakout of the persistent trend of lower highs that has dominated since March of this year.
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“The weekly close above these specific levels is not merely a technical achievement but a psychological victory for market participants, indicating a weakening of the sell-side pressure and a recovery of bullish momentum,” Rekt Capital noted.
Historically, bitcoin shows a tendency to initiate major rallies roughly 150-160 days after a halving event. Drawing parallels to the post-halving periods of 2016 and 2020, the analyst suggested that similar conditions are currently forming, with bitcoin around 133 days after the last halving.
“This cyclical observation aligns well with current market dynamics, where bitcoin is methodically testing and in some cases breaking important technical barriers,” he commented. This comparison is not only based on temporal patterns, but also on the qualitative nature of market behavior during these periods.
An important point of analysis was the 21-week EMA, a key indicator often considered the barometer of a bull market. Rekt Capital highlighted its historical importance, noting: “Deviations below the 21-week EMA in bull markets typically offer lucrative buying opportunities, as seen in the 2021 cycle. bitcoin is currently oscillating around this EMA, providing mixed signals that require careful interpretation.”
Looking ahead, the analyst anticipates that for bitcoin to embark on a new parabolic phase leading to price discovery and potential new all-time highs, it must first consolidate above the $71,500 level, which represents the top of the reaccumulation range. This level has previously acted as formidable resistance, and a weekly close above it would likely catalyze a major bullish phase.
“In the coming weeks, the market’s ability to hold these critical supports and break through resistance levels with conviction will be paramount. This will determine the viability of a breakout that aligns with historical patterns seen post-halving,” Rekt Capital concluded, suggesting that October could be pivotal for bitcoin’s trajectory.
At the time of writing, btc was trading at $63,956.
Featured image created with DALL.E, chart from TradingView.com