just kicked in the door on quarter 4.
If we think of this final stretch of the year that runs from October 1 to New Year’s as a football game, we could view this week’s BTC price action as the bulls taking the opening drive of the game and bringing it right down to the bear’s goal line.
As you can see below, and as I’m sure you already know if you’ve been monitoring markets this week, BTC has now gone up over 10% in just 4 days’ time.
Last week, as the price retested that key put wall level at $110,000, we discussed that last month, market sentiment was telling us it was so over. Now that we’ve reached the top end of the range to test the $120,000 call wall, we are so back.
The truth, however, is likely somewhere in between, in that BTC, for the time being at least, is just continuing to range and consolidate in the same range it has been stuck in since its first run up to $120,000 in mid-July.
If we ignore the few short-lived deviations above $120,000 but below $110,000, we can see how the price has been merely testing both ends of the range for liquidity for the better part of the past 3 months.
With this perspective in mind, one should be careful of becoming too eager too early over BTC’s bullish start to quarter 4, as the bear’s goal line defense at this far end of the range remains formidable.
As we can see below in the aggregated orderbook information, across the various different exchanges where spot BTC is traded, there rests a goliath wall of sell orders stretching up from the low $120,000s on up to $140,000. In total the sum of all these advertised sell orders aggregates to over $656,000,000 at present which at time of writing are dampening bull spirits and crushing the bull’s hopes for an early October sprint to new all-time highs.
Overcoming the resistance in this region to make a lasting break above $125,000 will likely take a lengthy period of consolidation, lasting anywhere from two to six more weeks.
During this consolidation traders should be mindful of the fact that though the prospects for BTC into the end of the year have never looked brighter, especially considering the staggering ETF inflows we’ve seen this week which have already totaled over $1.7 billion this week alone, and over $3.7 billion in the past 30 days, price is still in a reaccumulation range.
This means that just as quickly as we raced from the bottom to the top end of the range last week, it is equally likely we revert back into the $114,000 – $117,000 range at the least prior to the bigger breakout.
A pullback and some further consolidation back below $120,000 would ultimately prove to be healthier for BTC over the longer run as it would eliminate froth in the futures market, and allow institutional players to continue their spot ETF accumulation at favorable prices, ultimately creating a more solid foundation for price to break out of in the later stages of quarter 4.
My advice would be if you’ve been patient enough to wait out this range over the past few months, stay patient, and avoid falling prisoner to the sentiment of the moment during these up and downside range deviations.
There are no straight lines in trading, at least as far as BTC goes, and don’t despair over the time it takes to break out this month. Those who can remain tactful, and avoid panic selling during reversions, and FOMO buying during top side retests should still see the best is yet to come later on this year.
And after all, it’s not like a ranging BTC market is devoid of opportunities either.
There is often nothing better catalyst for the alt-coin market than bullish BTC consolidation, we in the Highstrike trading room witnessed and capitalized on just that earlier this week, when we caught these cheeky longs on Zcash earlier this week and rode our position up for a monster +120% return in just 3 days time.
Though such quick returns are an obvious outlier, I suspect similar bullish opportunities will not be few and far between as head into the heart of October and I hope to see you in our community when we catch the next one.
Until then…
***
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