October, fondly referred to as “Uptober” by crypto and bitcoin community members, is yet to live up to its name.
Over the first part of the month, there were no significant upswings in the price of Bitcoin and Ethereum. Being two of the flagship cryptocurrencies with a combined market dominance of more than 60%, the performance of these cryptocurrencies inherently affects that of all the others in the market.
Technical Analysis of Bitcoin
The price action of bitcoin throughout October has been relatively neutral. On the charts, bitcoin moved significantly to the upside at the beginning of the month and even broke the $20,000 mark. Soon after, it hit a high of $20,400 only five days into the month.
However, bitcoin experienced a trend reversal soon after. The bears started to push the price downwards, canceling the gains from early October and driving the cryptocurrency’s price well below the $19,000 support.
This week (13 of October precisely), more than 60,000 traders got liquidated as $220 million got wiped off the crypto market, according to data from CoinGlass.
Bitcoin retested the $18,20 low it last touched in mid-September after the news of the FED-rate hike hit the internet.
Soon after hitting this support, bitcoin started to trend upward. It has crossed the $19,000 support and now trades at $19,700.
At this point, the price action of Bitcoin is hard to predict. The cryptocurrency has been stuck between $20,187 and $18,250 since September 19.
Bitcoin Chart
Overall, bitcoin is bearish from a long-term perspective. It still appears to be trading inside the bearish channel it has failed to break out of for almost a year. However, things start to get interesting if one zooms in on the chart. Bitcoin, it appears, is now pushing up against the upper resistance of the channel as the bulls continue to apply pressure on the bears.
The next few weeks may prove to be an interesting period for bitcoin if the bulls apply enough pressure to break this upper trendline. The cryptocurrency may experience massive bullish price action that takes its price to the $22,600 zone, at least before we see any form of price correction.
Conversely, if the bulls are unsuccessful in their attempt to break this level, bitcoin may dive deeper than the $18,250 support and go as low as $16,400.
Ethereum in the Charts
The outlook on Ethereum isn’t especially positive, despite last week’s weekly candle closing in the green.
Ethereum appears bearish over the long term, as illustrated by the daily chart.
The lower support of the wedge (in red) has been holding the cryptocurrency’s price action since June and is now in grave danger of being broken to the downside.
Coupled with the critical lower support of the wedge, the price of Ethereum appears to have bounced off the 78.6% Fibonacci level on the daily timeframe. If the lower support of the wedge fails to hold, the next level Ethereum is likely to fall to is the 10% Fibonacci level around the $1000 mark.
Overall, the price action of Ethereum appears bearish and needs a strong push from the bears to break through the upper support of the wedge. Failure to break through this level would result in a massive downtrend and Ethereum again retesting the $950 zone.
Disclaimer: The author’s comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)
