Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Bitcoin is on track to conclude October with a modest gain, defying earlier volatility and a significant mid-month correction, as the cryptocurrency currently trades above the critical $114,200 monthly open level. Despite the historical expectation of “Uptober” delivering average gains exceeding 20%, Bitcoin’s performance this month has been more subdued, influenced by a blend of bullish technical signals, institutional inflows, and broader macroeconomic factors.
October’s Volatile Trajectory
The month began with Bitcoin spiking above $123,000 before experiencing a sharp 13% correction that pushed its price down to $107,000. Bulls have since staged a recovery, bringing the price back to around $115,000. As October nears its end, Bitcoin holds a slender 1.14% gain for the month, according to data from Coinglass.
Macroeconomic Tailwinds and Institutional Interest
Traditional markets are exhibiting strong performance, with the S&P 500 reaching new record highs. This risk-on sentiment is partly driven by investor expectations of a potential quarter-point rate cut from the Federal Reserve, which would lower rates to the 3.75%-4.00% range, typically bullish for risk assets like cryptocurrencies.
Adding to the positive outlook, Treasury Secretary Scott Bessent hinted at progress toward resolving U.S.-China trade tensions, ahead of a scheduled meeting between President Donald Trump and President Xi Jinping. This combination of dovish monetary policy signals and easing geopolitical concerns has fueled a supportive environment for crypto.
Institutional demand for Bitcoin remains evident, with spot Bitcoin Exchange-Traded Funds (ETFs) recording their third consecutive day of inflows, totaling $149 million. Such sustained inflows from regulated products often indicate strong conviction from larger investors, contributing to price stability.
Technical Indicators Point to Continued Strength
Short-term technical analysis suggests Bitcoin is likely to maintain its position above the $114,200 threshold. The four-hour chart indicates a bullish structure, with prices having broken past recent resistance and now trading within an ascending channel.
The Average Directional Index (ADX) stands at 32.14, signaling strong trend momentum. The Relative Strength Index (RSI) is at 69.05, approaching overbought territory but still allowing for potential upside before triggering a correction. While the 50-period Exponential Moving Average (EMA) remains below the 200-period EMA, a typically bearish “death cross” configuration, current price action is well above both, with the 50-period EMA moving upwards, hinting at a potential “golden cross” bullish setup.
The Squeeze Momentum Indicator is flashing a “bullish Impulse” with a “long” signal, suggesting that a period of volatility compression has concluded and upward momentum is accelerating. Furthermore, Ichimoku Cloud analysis shows Bitcoin trading above the clouds, with a bullish future cloud forecast, indicating trend continuation.
Key Levels and Outlook
Immediate support for Bitcoin is identified around $114,000-$114,500, aligning with the monthly open. Stronger support lies at $112,000, while immediate resistance is at $116,000, with robust resistance anticipated between $118,000-$120,000.
Sentiment on prediction markets, such as Myriad, also reflects a bullish lean, with traders assigning a 70% probability that Bitcoin will rise towards $120,000 before a potential retracement to $100,000. However, the upcoming Federal Reserve policy announcement on Wednesday remains a significant binary risk event, and any hawkish language could introduce short-term volatility.
Given the confluence of bullish technical signals, supportive macroeconomic conditions, and continued institutional interest, Bitcoin appears poised to close October in the green, even if the “Uptober” gains are more modest than historical averages.
