Bitcoin (BTC) price is about to see a noticeable trend change on the weekly and monthly charts. In both periods, the break above $65,000 resulted in higher highs, breaking the trend of lower highs that has defined BTC’s price action over the past six months.
BTC/USDT weekly chart. Source: TradingView
Prior to this week’s rally past $66,000, the cryptocurrency market suffered from an epic sell-off, but a new catalyst has led traders to believe that Bitcoin price is ready for the next phase of its rally higher.
The following events have occurred over the past few weeks:
- Spot Bitcoin ETF inflows surged to a total of $494 million, bringing total cumulative flows to $18.8 billion.
Cumulative spot Bitcoin flows. Source: Farside Investors
- MicroStrategy announced that it purchased 18,300 Bitcoin between August 6 and September 12, and an additional 7,420 BTC on September 20.
- The US stock market and gold hit record highs.
- The PBOC announced interest rate cuts and other money-printing measures that traders say are consistent with a rise in the price of Bitcoin.
- Data has emerged showing that the global money supply and the U.S. money supply will expand due to interest rate cuts.
Ultimately, traders believe interest rate cuts by central banks and a possible return to loose monetary policy will reduce the high yields offered by many investment vehicles and encourage the pursuit of yield in Bitcoin and other cryptocurrencies.
relevant: Bitcoin price at $62,000? Bearish div hints at slow start to Uptober
A brief return to $62,000?
From a technical perspective, Bitcoin has managed three daily closes above the 200-day moving average and the price has been trading above the 196-day downtrend line. As previously mentioned, a close above $65,000 sets up a higher candle for the weekly and monthly time frames.
This is the BTC/USDT 1-month chart. Source: TradingView
It would not be unusual for the price to fall to the 20-day moving average of $62,000 in the coming week. The move to watch out for will be whether traders step in with enough force to defend this level and make a call in the $66,000-$68,000 area.
Aside from the usual price action, one thing is clear: the new Bitcoin bullish story traders have been waiting for has arrived. This potentially suggests that the BTC price is preparing to test a new all-time high.
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.