The price of Bitcoin (BTC) has declined since reaching a high of $28,592 on October 2. The decline confirmed a deviation above the $28,000 horizontal area, which is now confirmed as resistance.
A recent amendment to ARK Invest and 21Shares’ joint application for a spot bitcoin exchange-traded fund (ETF) could be considered a “good sign” of progress and imminent approval.
The approval application filed Oct. 11 with the U.S. Securities and Exchange Commission adds additional information about the proposed bitcoin spot ETF, including practices for how the fund will custody the assets and determine their value.
Bitcoin Falls After High Range Rejection
Technical analysis of the daily time frame shows that Bitcoin price has fallen since reaching a high of $28,580 on October 2 (red icon). At the time, it seemed like BTC had broken out of the $28,000 horizontal resistance area.
However, the price could not sustain its increase. It fell below the area shortly after, validating it as resistance (black icon) on October 6. Bitcoin has fallen at a rapid pace since then, reaching a low of $26,538 on October 11.
The daily Relative Strength Index (RSI) gives a bearish reading. Market traders use the RSI as a momentum indicator to identify overbought or oversold conditions and decide whether to accumulate or sell an asset. Readings above 50 and an uptrend indicate that the bulls still have an advantage, while readings below 50 suggest the opposite.
The indicator is below 50 and falling, both signs of a downtrend. Furthermore, it has collapsed from its bullish divergence trend line (green line), which preceded the entire upward movement.
There is some very interesting news about Bitcoin today, as it marks the final deadline for the Securities and Exchange Commission (SEC) to challenge a court’s decision, which found insufficient grounds to block a spot Bitcoin exchange-traded fund (ETF).
If the SEC refuses to dispute this decision at the end of the day, they will exhaust their options to reject any further Bitcoin Spot ETFs. Consequently, they would be required to grant approval to all such ETFs. If the SEC does not take action today, it is increasingly likely that we will see the green light for all spots, and not just Bitcoin ETFs.
Additionally, 24,000 Bitcoin options contracts worth $640 million will expire today. The US consumer price index (CPI) for September stood at 3.7%, only slightly above the forecast of 3.6%.
If combined with a slightly higher than expected producer price index, this could lead to a slight increase in interest rates at the next meeting. While the US Dollar Index responded positively to the CPI, Bitcoin declined to some degree.
BTC Price Prediction: When Will the Price Bottom?
Technical analysts employ Elliott wave theory as a means of identifying long-term recurring price patterns and investor psychology, helping them determine the direction of a trend. The most likely Elliott Wave count is bearish.
Starting from the November 2022 low of $15,479, BTC price has completed a five-wave upward movement. If the decline continues, the most likely level for the bottom of wave C will be $21,800. The area coincides with the 0.618 Fib retracement support level and would give waves A:C a 1:1 ratio.
An analysis of BTC halving cycles also supports this possibility. A drop to $21,800 will mean a decrease of almost 20% from the current price. Despite this bearish Bitcoin price prediction, a rise above the wave B high of $28,592 may lead to a 15% upward move towards the $30,500 resistance area.
By Audy Castaneda
