The hopes for the approval of a spot Bitcoin exchange-traded fund (ETF) by the United States Securities and Exchange Commission (SEC) have caused a significant increase in Bitcoin’s price. In October alone, the price of Bitcoin rose by 27% due to the improved sentiment surrounding the potential approval of a spot Bitcoin ETF. This positive outlook attracted aggressive buying from crypto investors, leading to a surge in trading volume for related instruments. For instance, the ProShares Bitcoin Strategy ETF (BITO), the first futures-based ETF to receive regulatory consent in the U.S. this year, had its second biggest trading week ever with $1.7 billion in volume. Similarly, the Grayscale Bitcoin Trust (GBTC) recorded a volume of $800 million. This increase in trading volume for existing instruments indicates that spot Bitcoin ETFs are likely to experience significant volumes once they are approved.
The performance of Bitcoin also has a spillover effect on the rest of the cryptocurrency market. When Bitcoin performs well, it tends to lift the entire sector. This is evident in the strong performance of altcoins, which have seen a sharp increase from their multi-year lows. However, not all altcoins will be able to maintain their upward momentum after the initial rally. It is important for investors to stick with the leaders in the market, as they are more likely to outperform during the next bullish phase of the cryptocurrency market.
Now let’s analyze the charts of the top 5 cryptocurrencies that have the potential to extend their rally in the coming days.
Starting with Bitcoin, the price pulled back from $35,280 on October 24, indicating that higher levels are attracting selling pressure. However, the long tail on the candlestick chart shows that there is solid buying support at lower levels. The rising moving averages suggest an advantage for buyers, but the overbought levels on the relative strength index (RSI) indicate that Bitcoin may spend more time in consolidation. The key levels to watch on the downside are $32,400 and $31,000, while a break above $35,280 could indicate a bullish continuation with a target objective of $40,000.
Moving on to Ethereum, the price climbed above the $1,746 resistance level on October 23 and reached $1,865 on October 26. Although there was selling pressure at this level, the bulls successfully defended the retest to $1,746, indicating that it may now act as a new support level. The rising 20-day exponential moving average (EMA) and the RSI near the overbought zone suggest that the bulls are in control. If they can push the price above $1,865, Ethereum could see a rally towards $2,000. On the downside, a sustained break below $1,746 could open the doors for a deeper correction.
Aptos (APT) has also experienced a sharp rally in recent days, suggesting a potential comeback for the bulls. The price witnessed profit-booking near $7, but the fact that the bulls did not give up much ground indicates that every minor dip is being bought. The key level to watch is $7, as a break above it could lead to a march towards $8. On the other hand, a turn down from $7 would suggest that bears remain active at higher levels, potentially leading to a range-bound movement between $7 and $6.20. A break below this range could signal a deeper correction.
Quant (QNT) broke above the breakdown level of $95 on October 23, indicating a rejection of lower levels by the market. The price also cleared the downtrend line on October 25, signaling a potential trend change. However, short-term profit-taking may lead to a minor correction or consolidation in the near term. The key level to watch is $110, as a break above it could indicate a resumption of the rally towards $120 and $128. On the downside, a drop below the downtrend line may suggest that the rise above it was a bull trap.
Finally, THORChain (RUNE) completed a bullish inverse head and shoulders pattern by breaking and closing above the overhead resistance of $2 on October 23. The uptrend is supported by upward sloping moving averages and an overbought RSI, indicating that bulls remain in control. However, a minor correction or consolidation may occur in the short term. The key level to watch is $2, as a sustained break below it could signal a shift in sentiment. On the upside, a rally towards $3 and the pattern target of $3.23 is possible if bulls maintain their positions.
It is important to note that this article does not provide investment advice or recommendations. Every investment and trading decision involves risk, and readers should conduct their own research before making any decisions.