The Bitcoin price soared to a new record on Wednesday following the long-awaited listing of a Bitcoin-related Exchange Traded Fund. Bitcoin (BTC) reached a new-all-time of $66,999 late in the day before pulling back to $66,000 in early Asia trading. The latest move higher brings BTC’s gains in October to 50% and 120% year-to-date.
The Bitcoin bulls are running rampant in October, fueled by optimism surrounding this week’s ETF launch. After a 9-year battle, the Securities and Exchange Commission (SEC) finally gave the go-ahead for a Bitcoin-based listed ETF. The Proshares Bitcoin ETF (BITO) was an instant hit, surging to over $1billion in value, making it the most successful ETF launch of all time. However, it’s essential to understand that the fund has no direct exposure to Bitcoin. Instead, the ETF is linked to the price of Bitcoin futures. Whilst the ETF will offer investors exposure to the Bitcoin price, it is considered a costly alternative to ‘physical’ coins. Nonetheless, the launch is bullish for BTC, as predicted in our recent deep dive into Bitcoin. However, the question is, what happens now?
BTC Price Forecast
The daily chart shows that Bitcoin is trading in a long-term uptrend. BTC retreated to the lower edge of the bullish channel in July when the Peoples Bank of China announced enhanced measures against cryptocurrencies. However, Bitcoin has improved by 120% since then, recouping all of the losses suffered in May through July.
Now that BTC is above the former ATH high at $64,900, it must maintain the bullish momentum. The obvious fear is the large buying ahead of the launch has left investors over-exposed at the top-end of the historical range. Furthermore, the Relative Strength Index of 77.20 signals the price is overbought and vulnerable to a correction. Nonetheless, the Bitcoin price may extend higher in the near term, considering the bullish momentum. However, I expect volatility, taking into account that BTC is up 50% already this month. Furthermore, the bullish view relies on BTC maintaining the psychological $60k level. If the price drops below the significant figure, it could be the catalyst for liquidation. On that basis, the outlook is cautiously optimistic above $60k and undecided below it.
Bitcoin Price Chart (Daily)
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