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Ahead of its monthly close, bitcoin (btc) has seen another failed attempt to reclaim the $72,000 resistance as a support level. Despite the drop, some analysts believe the cryptocurrency is still in a strong position for an upcoming breakout, setting the next levels to watch.
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btc's Sweet 16 Party Gets Spooky
bitcoin, the largest cryptocurrency by market capitalization, recorded an impressive rally on 'Uptober', rising around 13% in the last 30 days. btc price has jumped from the monthly low of $58,900 to near its all-time high (ATH) price of $73,737, reaching the $73,300 mark on Wednesday.
Following September's green close, the flagship cryptocurrency will have its best monthly close since March, potentially posting around 13% to 14% in monthly returns despite its most recent price action.
On the 16th birthday of its whitepaper, bitcoin recorded a hair-raising 2% drop, sending the rest of the market into a red Halloween party. btc price fell below the $71,000 mark, hitting an intraday low of $70,600. Meanwhile, the second-largest cryptocurrency by market capitalization, ethereum (eth), retreated around 5.1%, losing the $2,600 support zone.
Cryptographic analyst Ali Martínez x.com/ali_charts/status/1851994553676386309″ target=”_blank” rel=”nofollow”>pointed out that today's drop is the fifth consecutive rejection btc faces at $72,000. Since its ATH, bitcoin has been rejected from this resistance level five times, falling between 8.2% and 18% the previous four times.
Altcoin Analyst Sherpa x.com/AltcoinSherpa/status/1851996860438700207″ target=”_blank” rel=”nofollow”>suggested that btc could see a 4% to 5% drop if the largest cryptocurrency fails to hold the $70,000 support zone. However, Sherpa believes that the cryptocurrency should “see some type of rebound” from the $70,800-$71,400 area in the short term.
btc is expected to have an extremely volatile week ahead of the US presidential election. Bitfinex analysts predicted that bitcoin volatility will peak between November 6 and 8, as speculation and anticipation over the election outcome will impact the cryptocurrency's performance.
Is bitcoin preparing for year-end breakout?
Cryptoinsightuk intervened in the performance of bitcoin, x.com/Cryptoinsightuk/status/1852004437163753506″ target=”_blank” rel=”nofollow”>observing that btc is still at ATH by Open Interest (OI). The crypto investor believes that the Daily Relative Strength Index (RSI) could potentially “cross lower” today.
He also highlighted that $69,600 should serve as a key support level for bitcoin bulls, but warned that losing the $66,500 range could be “confusing” as btc open interest would “empty.”
Meanwhile, crypto Kaleo x.com/CryptoKaleo/status/1852011709541564574″ target=”_blank” rel=”nofollow”>aware a more bullish outlook for btc price action. The analyst highlighted that the flagship cryptocurrency did not surpass its ATH when it retested the $20,000 mark in 2020.
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Instead, bitcoin initially retreated nearly 20% over Thanksgiving, going from $19,400 to $16,100. Furthermore, btc price accumulated within that range for 30 days before the breakout, with the next leg rising in late December 2020.
The analyst noted that the breakout occurred 219 days after the May 2020 halving. Given that bitcoin is currently 194 days after the halving, the analyst believes that “a small pullback here is not a cause for concern.”
At the time of writing, bitcoin has held the $70,000 support level and is currently trading at $70,522.
Featured image from Unsplash.com, chart from TradingView.com
