Despite the Federal Reserve’s (Fed) announcement of a 25 basis point rate cut, Bitcoin (BTC) has fallen nearly 4% over the past 24 hours, losing its local low range for the first time in a week. Some analysts have warned that this week’s close is crucial for the flagship’s short-term performance.
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Bitcoin price eyes crucial weekly close
On Thursday, Bitcoin fell below the recently reclaimed $110,000 area, hitting a one-week low of $106,700. Notably, the cryptocurrency has been trading within the $108,000-$120,000 price range since July, but has failed to regain the highest values in the range after the early October correction.
In the middle of this performance, Ted Pillows suggested that the market volatility was expected as BTC has seen similar price action since the start of the third quarter. The analyst explained that Bitcoin has fallen 6%-8% after the last three Federal Open Market Committee (FOMC) meetings, but also reached a new all-time high (ATH) before the next one.
According to the chart, the price of BTC reached its local low 5-9 days after the meeting, quickly recovered from the decline and rose to new highs in the coming weeks. As the price retests the $106,000 area, Ted predicted that a repeat of the same playbook could happen.
However, he warned that Bitcoin must recover the $113,500 in the coming days to avoid a bigger pullback. “A weekly close below that level increases the likelihood of a bigger correction,” the analyst explained.
Similarly, Rekt Capital pointed out that Bitcoin needs to end the week above $114,500 for this level to turn back into support. He noted that after recent performance, a volatile retest of this level would be “perfectly good” as the price closes above this crucial level at the end of the week.
Confirming the Range Low of ~$114k as support would confirm the re-entry into the Range, restarting consolidation within the Range and allowing a move across it to the Range High of ~$119,000 (red) in an attempt to break out and challenge $120k+ again.
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Michael van de Poppe confirmed that $112,000 is the next key area to break before a new ATH as this has been a crucial resistance level in the daily time frame in recent weeks. According to the post, a breakout from this area could set the stage for a retest of the $119,000-$120,000 zone.
On the contrary, a rejection from this level could send the price towards $103,000 or lower, he warned. “I think we will see a new ATH in November,” the market watcher added.
Meanwhile, Daan Crypto Trades emphasized that BTC is “just playing ping-pong” between its key levels and will continue to move within its range until one of the boundaries is successfully breached.
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The trader added that November is one of Bitcoin’s best months based on historical performance, which could indicate that a price rally could be near. Notably, 8 of the 12 Novembers closed in green, with an average return of 10.82%, according to CoinGlass data.
Additionally, he noted that the last two months of the year were when the three previous bull runs peaked and the past two bear markets bottomed out. “Whether on the bullish or bearish side, volatility and major market upheavals have been the theme at the end of the year,” he concluded.
Featured image from Unsplash.com, chart from TradingView.com