Bitcoin (BTC) has seen a 4% increase in the month of October as geopolitical instability becomes the focus of the market. The price of BTC has remained steady at $28,000, but experts are wondering how it will react to the war in Israel. So far, Bitcoin has not shown a significant reaction to the events and has stayed within a tight range over the weekend. However, as the Wall Street opens with an increase in oil, gold, and U.S. dollar strength, that could change soon. Additionally, the upcoming release of the U.S. Consumer Price Index (CPI) in the coming days adds further importance to BTC price movements.
On-chain metrics are also indicating interesting times for Bitcoin. BTC/USD is currently trading in a key range that has been a significant area since 2021. Analysts are monitoring these factors and more to determine potential triggers for BTC price movements.
Over the weekend, BTC price action remained focused on the $28,000 level, with no significant changes. Traders are hoping for a resistance/support flip to indicate a clear direction for BTC. The 200-week moving average (MA) at $28,176 has yet to be decisively broken, according to traders analyzing the 4-hour chart.
Despite the lack of volatility over the weekend, some traders remain bullish on Bitcoin. They expect it to break out upward, especially since October is historically the most bullish month of the year. However, there are also concerns about potential volatility due to the war in Israel. Traders recall a previous BTC price drop during the war in Ukraine in February 2022, which was quickly erased within a day.
Bitcoin’s current price movement is also influenced by macroeconomic factors. The increase in oil and gold prices, along with the strength of the U.S. dollar, has resulted in a “risk-off tilt” among traders. The 100-week and 50-week moving averages for BTC/USD are at $28,938 and $24,890, respectively. Market participants are closely monitoring these levels to gauge BTC’s reaction.
The upcoming release of macroeconomic data in the U.S. adds further significance to BTC price movements. The September CPI report is highly anticipated after last week’s surprising employment data. If the CPI data is positive, it could provide an opportunity for BTC to break out of its current range. However, a hot CPI result could push BTC back into the range lows, as it may prompt the Federal Reserve to consider another interest rate hike.
Aside from the CPI report, other data releases and Fed speakers’ commentary throughout the week will also impact the markets. Overall, it is expected to be a “huge week for inflation and the Fed,” with market volatility potentially increasing.
On-chain metrics for Bitcoin are also signaling volatility. The network value to transaction (NVT) signal, which estimates local BTC price tops and bottoms, has reached its highest levels in five years. This indicates a potential shift in how Bitcoin’s value is perceived, suggesting its growing role as a store of value rather than just transactional utility.
Despite these factors, the general sentiment in the crypto market remains neutral, according to the Crypto Fear & Greed Index. Investors appear to be indecisive about the market, with neither excessive fear nor greed. The lack of volatility in recent months has also contributed to this sentiment.
In conclusion, Bitcoin is experiencing a relatively stable period, but that could change soon as geopolitical tensions and macroeconomic data releases create potential triggers for price movements. Traders and analysts are closely monitoring BTC’s reaction to these factors and expecting increased volatility in the coming days.