Bitcoin made headlines on October 20, as it’s price crossed the $30,000 mark by jumping 4%, just as Wall Street opened for the day. BTC soars to a level that was last seen in August, as analysts turn their attention to the weekly close after the price reached $30,233.
However, it experienced a slight dip afterwards. At the time of writing, BTC is trading around $29,500. The market’s volatility is still noticeable, prompting market participants to buzz around the importance of a weekly candle close to confirm the sustainability of the rally.
Analysts Explain Crucial Levels
Keith Alan, co-founder of Material Indicators, explained the significance of the 100-week moving average (MA) at $28,627. He stated that investors should monitor whether the weekly candle closes above this MA. Notably, if the next week’s candle remains above this level without any wicks below, it could be a confirmation of a bullish breakout.
“Some might consider that a confirmation of a bull breakout, but this market is known for squeezes and fakeouts, so I’m looking for more confirmations. For me, BTC will also need to take out prior resistance at $30.5k, $31.5k, and ultimately $33k to call a bull breakout confirmed and validated.”
On a similar note, popular bitcoin trader Skew analyzed the low-timeframe (LTF) conditions and noted the possibility of a sweep of late-long positions, potentially offering an entry point before the uptrend resumes. His X post reads:
“So if this LTF trend breaks, a nice sweep could be a nice entry before higher, and I wouldn’t be surprised to see something like this play out.”
Meanwhile, another trader, Pentoshi, set a critical support level of $28,900 for bullish investors.
Looking at a longer timeframe, the trading team at Stockmoney Lizards expressed optimism that the resistance just above $30,000 would soon be overcome. The analysts suggested that significant upside potential is imminent, especially if the United States approves its first Spot Bitcoin Exchange-Traded Fund (ETF).
BTC Soars Above $30k: Possible Reasons
Here are a few combined factors, including regulatory developments, market sentiment, and economic conditions, that contributed to the notable price surge of bitcoin on October 20:
Spot Bitcoin ETF Approval Expectations
One major catalyst behind the recent price surge is the anticipation of the approval of a U.S. Spot Bitcoin ETF.
Earlier this week, Blackrock and Fidelity submitted their updated proposals for the Spot Bitcoin ETF. As the refiling and modifications progress, there’s growing hope for approval. A recent report by Matrixport predicts that the BTC price can surge to $56,000 if Blackrock’s ETF receives the green light from the United States Securities and Exchange Commission (SEC).
Related reading: Recent Spot Bitcoin ETF Filings Are Inadequate — Says SEC
Notably, the approval of a Spot Bitcoin ETF would provide easier access to bitcoin for institutional and retail investors, thereby boosting demand.
SEC’s Withdrawal from the Ripple Case
The SEC’s decision to withdraw its appeal in the case against Ripple might be another influential factor in the recent BTC price rise. Interestingly, this event had a positive impact on the overall digital asset market. The withdrawal indicates a degree of regulatory clarity and reduced uncertainty, which typically leads to increased investor confidence and capital inflows.
Another important factor that could have contributed to the recent price rise is rising inflation. As a decentralized and deflationary asset, Bitcoin is often considered a hedge against inflation. With ongoing inflationary pressures, investors often get attracted to bitcoin to preserve their wealth.