Bitcoin showed some strength during today’s trading session after revisiting the bottom of an important trendline. The benchmark cryptocurrency traded in a narrow range, between $18,600 and $19,500, but the monthly close could support a spike in volatility as the bulls and bears fight for this candle.
At the time of writing, Bitcoin (BTC) is trading at $19,400 with a gain of 2% in the last 24 hours and 7 days. Other cryptocurrencies appear to be the next Bitcoin as they are posting small profits on lower time frames. The benchmark cryptocurrency may be poised for further gains.
Bitcoin Paving The Way For More Profits?
In addition to the monthly close, the recent bitcoin price action appears to be supported by the collapse of the US dollar. The coin managed to reach levels last seen in the early 2000s, touching 115 on the DXY, but was rejected from these levels.
At the time of writing, the DXY is trading at 112 and may return to its early September lows in the south. The rise of the DXY index has been one of the main obstacles limiting the upside in Bitcoin and other risky assets, such as stocks.
In this sense, revisiting the September lows may allow the cryptocurrency market to extend the current bullish price action over the coming weeks. According to Analyst Justin Bennett, the price action of the DXY index may support Bitcoin’s rally to $26,000.
Cryptocurrency may reach this level before the upcoming meeting of the Federal Open Market Committee (FOMC) of the US Federal Reserve. As shown in the chart below, Bennett claims that Bitcoin is trading in a channel with a bottom around $18,700 and a high of $27,000.
With the US dollar trading to the downside, Bitcoin may be able to regain the top of this channel. “As long as there is $18,700 in it, this is my Bitcoin playbook through October,” the analyst wrote.
Bitcoin in a lighter ‘bear market’?
Additional data from pseudonym analyzer Indicates Bitcoin may be in a lighter price movement. The analyst looked at the previous BTC price drop from all-time highs (ATH) and discovered that the cryptocurrency is only 74% of those levels.
In the bear markets of 2013 and 2017, Bitcoin crashed 84% from its previous all-time highs and in 2011, 93%. This could indicate that the BTC bear market is getting weaker or that the cryptocurrency may experience another downturn.
In addition, the analyst discovered that Bitcoin is 316 days away from its all-time high. In previous years, the cryptocurrency was able to find a bottom with an average of 312 days after crashing from ATH. In this sense, the analyst concluded:
The 316 day period in the current bear market so far is between 2011 and 2013+ 2017. Either we’re ending soon or this time is different. Average duration from top to bottom is also very interesting. The average is 312 days, which is where #Bitcoin is now.