Bitcoin (BTC) saw a consolidation near $34,000 after experiencing a 15% daily gain following the Wall Street open on October 24. The cryptocurrency had reached 17-month highs near $35,200 fueled by excitement over the potential approval of a Bitcoin spot price exchange-traded fund (ETF) in the United States. TradingView and Cointelegraph Markets Pro provided data on BTC price volatility throughout the day, with $34,000 being a significant focus at the time of writing.
Material Indicators, a monitoring resource, analyzed the events leading up to a $5,000 daily candle and found a support/resistance (R/S) flip at $30,600. It was surprising to see how quickly the market broke through the resistance that had been in place for the past year and a half. Material Indicators had expected more resistance at levels such as $30.5k, $31.5k, and even $33k. However, those levels were easily surpassed, and the market quickly reached $35k after an $87M buy wall appeared at $30.6k, triggering the R/S flip. While bid liquidity had been pulled from below, there was a potential for a retracement.
One chart displayed the Binance order book data for BTC/USD over the past 24 hours. It indicated other factors contributing to a deeper consolidation, including funding rates across exchanges that were deep inside positive territory. CryptoBullet, a popular trader, noted that the majority of traders were long, which meant that the market maker would likely wipe out those late long positions. BTC short liquidations on the way up totaled $161 million and $48 million for October 23 and 24, respectively.
Another trader, Daan Crypto Trades, suggested that the market might maintain its direction. He compared the positive funding rates during the bull market to the time when they were mostly negative during 2022-2023. Bitcoin’s retracement on the day coincided with a reversal upward for the U.S. dollar strength, as seen in the U.S. Dollar Index (DXY) which rebounded by 0.5% from its intraday low.
James Stanley, a macro analyst, explained that the release of Personal Consumption Expenditures (PCE) data on October 26 would have a major impact on the DXY in the short term. This data release precedes the November 1 meeting of the Federal Open Market Committee (FOMC), where the U.S. Federal Reserve will make decisions regarding interest rates. Stanley highlighted that defending the low of 104.70 from the previous FOMC would be crucial for the bulls.
Bitcoin’s reaction to DXY movements has been mixed, unlike the inverse correlation that was previously seen. It is important to note that this article does not provide investment advice or recommendations, and readers should conduct their own research before making any decisions.