Bitcoin (BTC) is showing signs of a late September comeback, sparking renewed debate among bulls and bears as the month and quarter draw to a close. After a volatile week, BTC briefly surpassed $112,000 on Monday, September 29, a level not seen since a sharp fall last Thursday. This recovery has led some analysts to suggest that Bitcoin is still in a bull market.
Price Action and Analysis
Currently, Bitcoin is trading around $111,835. The cryptocurrency has been struggling to gain ground, with analysts noting investor exhaustion and recent drops triggering significant liquidation events in the broader crypto market. Despite this, Bitcoin managed to close the week above the key $112,000 price level, setting the stage for a potential tug-of-war between buyers and sellers.
Some market participants remain cautious, awaiting further confirmation before declaring a full-fledged return of the bull market. Crypto investor Ted Pillows pointed out that Bitcoin's recovery, similar to Ether's, was mainly due to the closure of short positions. For a strong Bitcoin rally, a daily close above $113,500 is necessary; otherwise, a revisit to previous lows is likely, according to Pillows.
Popular trader Roman anticipates price fluctuations within a narrow trading range, suggesting a "ping pong" scenario between the upper and lower boundaries, specifically between $112,000 and $108,000. To establish a bullish trend, Roman insists that bulls must reclaim the $118,000 mark.
On-Chain Data and Market Sentiment
Despite recent volatility, on-chain data suggests underlying resilience in the Bitcoin market. Crypto investment firm XWIN Research Japan noted that long-term holder behavior and Bitcoin's Market Value to Realized Value (MVRV) ratio indicate that the bull market is not over. The MVRV ratio, which compares market value to the average cost basis of holders, currently sits at 2, reflecting neither panic nor euphoria, according to XWIN. They believe investors are still seeing healthy gains, but the market has cooled from overheated conditions. Historically, Bitcoin has entered its strongest expansion phase after consolidating within this MVRV range.
Furthermore, profit-taking among long-term investors has decreased, effectively reducing the available supply and potentially creating conditions for renewed demand and price increases. These metrics suggest that the current cycle has not reached its terminal stage and that further upside potential exists.
The Crypto Fear & Greed Index has also risen to "Neutral" for the first time since September 19, signaling a recovery from a period of "Fear".
Macroeconomic Factors
The week's macroeconomic highlight is the U.S. employment data amid ongoing pressure on Federal Reserve Chair Jerome Powell. Gold has already set fresh all-time highs, leading to calls for Bitcoin to follow suit.
Key Levels to Watch
- Resistance: $111,909, $113,500, $114,790, $117,355, $118,000
- Support: $108,000, $108,143
Overall
Bitcoin's price is currently navigating a crucial juncture, with technical indicators and on-chain data providing mixed signals. While some analysts predict further consolidation and potential downside risk, others maintain a bullish outlook based on long-term holder behavior and market sentiment. The cryptocurrency's ability to overcome resistance levels and maintain support will likely determine its trajectory in the coming weeks.
