The BTC bull run still has “at least 6 months” left – 5 things to watch for Bitcoin this week

Bitcoin (BTC) starts a new week after its first attempt to crack $ 50,000 in over a month – what’s next?

After an encouraging weekend, BTC / USD is facing an increasingly bullish macro climate and a plethora of expectations from analysts calling for October to change the game.

Q4, they say, should be unlike anything seen in the current Bitcoin bull run, and the latest estimates even argue that there are more than six months left to prove it.

With “Uptober” for the first full week, Cointelegraph takes a look at what factors could move the market next in the coming days.

The markets are preparing for a “stormy ride” in October

Stocks may have had a flat September, but the first few days of the new month have already shown that Bitcoin can outperform the macro package with little good news.

While the S&P 500 fell 5% in September, BTC / USD closed the month around $ 4,000 below its August closing price.

However, since October 1, the couple’s fate has changed its tone, and contrary to expectations that stocks will rebound at the expense of the US dollar, the positive headwinds for Bitcoin could well persist.

“The fourth quarter of 2021 is likely to produce above-average returns,” said CNBC over the weekend Sam Stovall, chief investment strategist at research firm CFRA.

“Investors, however, have to hold on during the usually turbulent October drive, when volatility was 36% higher than the average for the other 11 months.”

The mood last week was shaped by the vote on the US infrastructure law, which will now be postponed until October 31 at the latest.

The USD is currently its highest level in over a year as measured by the US dollar currency index (DXY). A trend reversal in the past few days – traditionally a bullish catalyst for Bitcoin – is on traders’ radar.

For the popular Twitter retailer Crypto Ed, a DXY correction could even be made last months instead of weeks.

DXY 1-day candle chart. Source: TradingView

$ 50,000, but not yet

After Bitcoin slashed $ 49,000 over the weekend, Bitcoin is clearly planning an attack on the all-important $ 50,000 mark – just not quite yet.

Despite bullish stimulus, Sunday’s most recent break ended in heavy rejection and a subsequent drop of nearly $ 2,000.

However, commentators by and large dismissed this as a bearish signal, claiming that any BTC price weakness will be temporary.

Among them is Cointelegraph employee Michaël van de Poppe, who that day reiterated his latest theory of brief consolidation followed by another bullish breakout.

Trading colleague Pentoshi, meanwhile, compared the situation to activity in the fourth quarter of last year, when it was $ 20,000 instead of $ 64,500 that hit Bitcoin.

“I don’t really care about short timeframes. I’m interested in the macro-market structure, ”he said called in accompanying Twitter comments.

Drop or no drop, BTC / USD also hit a solid weekly close of $ 48,234 – completely undoing the last two weeks of action.

Trader and analyst Rekt Capital also noted that the 111-day moving average of the Pi cycle is seen as support, fueling the recent rally.

New hash rate all-time highs are trickling in

You can never know for sure, but by some estimates, the Bitcoin hash rate has already hit new all-time highs.

Less than five months after China triggered a mass migration of miners and equipment due to regulatory action, data sources show that the fundamental metric fully compensated for the upheaval.

Additionally, the hash rate may have hit 200 exahashes per second (EH / s) in the past few days – a whopping 32 EH / s above its previous high.

Measuring hash rate is difficult – Bitcoin mining performance cannot be accurately determined, so any representation can only be a guess.

While various sources vary widely – CoinWarz recorded 201 EH / s on Oct 2, while MiningPoolStats is currently only showing 138 EH / s – the overall trend is undeniable.

Bitcoin network fundamentals are firmly in “Up Only” mode, reflecting miners’ continued long-term belief in profitability.

“China kicked out almost 90% of the bitcoin miners in the country earlier this year. As a result, the hash rate dropped by about 50%, ”said Anthony Pompliano, co-founder of Morgan Creek Digital commented on the data.

“Just a few months later and we’re almost back to an all-time high. Economic incentives are driving the decentralization of the networks. “

Bitcoin 7 Day Average Hash Rate Chart. Source: Blockchain

As Cointelegraph reported last week, the difficulty level will also challenge records this week, with the next adjustment likely to be the seventh straight increase.

This has not happened since 2019, while the difficulty is around 20% below its all-time highs from May.

Halfway through?

It’s no secret that Bitcoin’s best-known analysts are calling for a spectacular performance in the fourth quarter of the BTC price action.

For PlanB, the creator of the stock-to-flow model family, the “worst-case scenario” for Bitcoin has come true for two months in a row.

His floor estimates are now $ 63,000 by the end of October and a whopping $ 98,000 by the November close.

When zooming out, however, the picture remains even rosier for Bitcoin bulls, he says. In its latest stock-to-flow cross-asset (S2FX) To update, PlanB showed price action of around 50% during its bull cycle, which left the door open to quick gains.

“IMO we are halfway there, no sign of weakness (red) yet. Notice that the color overlay is not months to halve, but a signal in the chain, ”he commented on the graph.

“My guess: this second stage of the bull market will take at least another 6 months.”

Bitcoin S2FX chart as of October 3rd. Source: PlanB / Twitter

Bitcoin has yet to catch up with the daily estimates of stock-to-flow as the spot price has deviated record shares in recent months.

For Monday, according to the monitoring resource S2F multiple, BTC / USD should be trading at just over $ 100,000.

Pricing in a Bitcoin ETF

As Cointelegraph reported, the chances are good that some kind of Bitcoin Exchange Traded Fund (ETF) will receive regulatory approval from the US this month.

Related: Top 5 Cryptocurrencies You Should See This Week: BTC, LUNA, ATOM, XTZ, AXS

A futures-based ETF should be the first to give the green light, as the Securities and Exchange Commission (SEC) “kicked the can” in a decision on a traditional product until at least November.

The market has been pricing in the groundbreaking moment for some time, but a decision could still turn the mood and thus the current state of the Grayscale Bitcoin Trust (GTBC) on its head.

Despite the price movements in recent weeks, the discount of the fund to the spot price remained substantial and currently remains at around 14%.

Premium graph in grayscale. Source: Bybt

Grayscale has announced that it will convert its flagship crypto funds into ETFs if circumstances permit, while data shows the business is far from suffering.

“In terms of volume, GBTC dominates its Bitcoin fund counterparts, who trade ten times more in US dollars than everyone else,” explains Bloomberg ETF analyst Eric Balchunas noticed last week.

“If it were an ETF, it would also be in the top 5% of the most active.”

Comparison of trading volumes of Bitcoin funds. Source: Eric Balchunas / Twitter