Bitcoin Price Nears 2023 Highs
Bitcoin (BTC) started the last week of October on a positive note, with a 3% gain in its price. The cryptocurrency market saw an upward trend, with BTC/USD approaching the 2023 highs. However, traders remain cautious as they anticipate resistance levels and potential headwinds in the form of macroeconomic data and geopolitical events.
RSI Gives Bitcoin Traders Cold Feet
Traders are divided on the potential for a breakout in BTC’s price. While some remain optimistic, others are more cautious. The Relative Strength Index (RSI) is causing concern among traders, as it indicates that a price correction may be on the horizon. With the RSI already at levels that have historically triggered sharp corrections, traders are closely watching BTC’s performance.
Exchange Balances and Bitcoin Outflows
Bitcoin exchange balances have decreased steadily, reaching levels not seen since 2018. The trend of declining BTC balances on exchanges continues despite the price recovery this year. Data shows that major trading platforms now have a combined BTC balance of 2.024 million BTC. This trend suggests that more coins are steadily leaving exchanges, which could potentially impact the supply-demand dynamics of BTC.
Low Numbers of New Market Entrants
One interesting observation is the low number of new market entrants in the past month. SignalQuant’s analysis using the Sum Coin Age Distribution metric indicates fewer newbies are entering the market. This data suggests that existing holders rather than new investors may drive BTC’s price rise. It is important to note that this is just one indicator among many, but it provides valuable insights into market behaviour.
Conclusion
In summary, the past week has seen Bitcoin’s price nearing 2023 highs, with traders cautiously watching for a potential breakout. The RSI has raised concerns among some traders, while others remain optimistic about Bitcoin’s future. Macroeconomic data, the Fed’s interest rate decision, declining exchange balances, and low numbers of new market entrants are all factors contributing to the current market sentiment.
