Bitcoin’s last opportunity in 2023

Compiled by: MarsBit

This article takes an in-depth look at Bitcoin’s technical signals and potential trends in 2023, analyzes the impact of multiple factors on its price, and provides investors with a comprehensive perspective. In a volatile market, staying informed and prepared will be key.

The ultimate opportunity for Bitcoin in 2023

Down three runs in the final inning, with the bases loaded and two outs.

The batter’s eyes are glued to the pitcher’s initial movement.

He has thoroughly analyzed the opponent’s pitching skills and has a good idea of what is likely to happen next.

What he was looking for was a perfect straight-line fastball, ready to be hit out of the park with accurate timing to complete the game-winning home run.

The moment he swung the bat, he had already predicted what would happen next…

The hit ball flew high and the crowd cheered wildly… and he celebrated with his teammates at home plate the rest of the night.

But the hit may be remembered as the most stressful in baseball history –

“Strikeout!”

The referee’s cry shattered his dream.

He didn’t hit the ball. At the end of the game, the teammates left the field disappointed.

What went wrong?

He expected a straight pitch, but it was actually a changeup. Being a little early, he failed to hit the ball.

The veteran pitcher deceived him perfectly.

If you’ve had a similar experience recently while trying to trade Bitcoin (BTC), know that you’re not alone.

With the influx of institutional traders and their advanced algorithms, finding the perfect entry point becomes more difficult.

The result is that we retail traders are trapped in a cycle of constant volatility and frustration.

Welcome to the big leagues, guys.

Today, we’ll take a deep dive into Bitcoin’s current technical signals and explore its likely direction in Q4.

Bitcoin at the Crossroads of Destiny

First, last month, Bitcoin once again had a death cross.

A death cross occurs when the 50-day moving average (MA) falls below the 200-day MA and usually signals a significant price decline in the coming months.

• Past data shows that in June 2021, Bitcoin had a death cross at nearly $43,000 and had fallen by more than 35% to $28,000 by the end of July.
• In January 2022, Bitcoin was trading at $48,000. By the end of the month, it had fallen by about 35% to $32,000, and even fell to $16,000 by the end of the year.

The current formation is very similar to what it has been in the past.

If Bitcoin wants to avoid falling below $20,000 this season, it must recover quickly in October.

Fortunately, such opportunities are still around the corner.

Currently, Bitcoin is facing key resistance towards the end of the third quarter.

These key resistances include the 50-point weekly Relative Strength Index (RSI), as well as the moving averages “9, close, 0, SMA, 5” that help us determine the overall market trend.

From the chart below, we can clearly see Bitcoin’s upward trend in 2023. Until August, when it plummeted from $29,000 to below $25,000, Bitcoin remained above the “9, close, 0, SMA, 5” trendline (blue line) and maintained the >50-RSI weekly mark ( purple line).

Each time Bitcoin retraced these indicators, it triggered three major rallies in BTC.

The first occurred in January, when the price of Bitcoin rose from less than $17,000 to over $23,000 in just one week.

The second time, in March, following the collapse of Silicon Valley Bank, the price surged from about $19,000 to over $28,000, also in just one week.

The third time was after BlackRock announced its ETF filing, which saw prices surge from around $24,500 to over $31,000, also just a week later.

If (and there’s really a big “if” here) Bitcoin can regain lost ground in early October, we have reason to expect another round of rapid gains. Because since Bitcoin failed to break through $30,000, those who are short will face huge liquidation pressure.

But we should also recognize that this rise may need a trigger.

However, that trigger now seems unclear as the SEC has decided to postpone decisions on most Bitcoin ETF applications until the first quarter of 2024.

While regulators left open the possibility of approving Grayscale’s ETF listing in their Oct. 13 statement, most experts believe they will most likely seek a further extension or engage in a legal battle.

This leaves Bitcoin with almost only one possible chance for redemption, a fall in its nemesis the U.S. Dollar Index (DXY).

Return to the top

Back on topic, since I last wrote to you in early August, my doomsday scenario for the U.S. Dollar Index has come true:

If DXY falls below the 50-RSI and its 200-day SMA, I predict that the Bitcoin and crypto markets will experience significant volatility.

My forecasted downside targets for Bitcoin are $24,600 (June low), $19,300 (March low), $15,300 (post-FTX low) and possibly lower.

In fact, DXY has broken above these resistance levels. Although BTC has only hit the first downside target so far, this bearish trend may just be a sign of bigger shocks to come from DXY.

As shown in the chart, DXY has regained all major moving average and RSI resistance levels, continuing its rise from August into October.

And the rise doesn’t appear to be stopping. Each downward adjustment is like a technical adjustment in order to better continue to rise.

Conversely, since the breakout on August 1, DXY has never come close to losing the 50-RSI mark, nor has it lost its “9, close, 0, SMA, 5” trendline on the weekly chart.

To add insult to injury for Bitcoin’s fourth-quarter outlook, DXY recently saw a golden cross opposite to BTC’s death cross for the first time since June 2021.

As the chart shows, the last time this pattern occurred, DXY rose from 91 to 114 about 15 months ago, so the likelihood of a downside move is slim to none.

Whether we like it or not, as long as the U.S. dollar maintains its current strength, it will be difficult for Bitcoin to make a difference. It remains influenced by the “king” of the U.S. dollar, as well as the liquidity provided to global markets by Federal Reserve Chairman Jerome Powell.

Based on the current DXY trend, Powell’s latest FOMC speech, and recent inflation data, this upward trend is unlikely to end in the short term.

In general, people in the centers of power seem to prefer to see the “king” continue to rule his subjects until some part of the traditional financial system collapses. To us, this could mean that Bitcoin could fall back to the 2022 lows before a liquidity bailout comes.

None of us want to see this happen, but as DXY continues to rise and BTC consolidates below key resistance levels, it becomes increasingly likely.

Overall, keep an eye on how prices react at these key resistance levels this month, but also keep an eye on DXY, which could determine where Bitcoin goes next.

The only thing that is certain is that Bitcoin’s price will not continue to hover between $24,000 and $30,000 by the end of the year.

Looking forward to communicating with you next time, I wish you good luck in trading, be prepared for the worst, and hope for the best.

You know, the market is always full of uncertainty, and nothing is 100% certain. The best we can do is make the best predictions we can based on the information and data available and be prepared for any eventuality.

At the same time, there are a number of factors that could impact Bitcoin and the crypto market as a whole. For example, global geopolitical tensions, slowing economic growth or unexpected events (such as epidemics or natural disasters) could adversely affect markets. Therefore, in addition to technical indicators, pay close attention to these possible risk factors.

However, this also means there are opportunities. For those investors with a long-term horizon, these shocks may provide buying opportunities. If you believe in the future of cryptocurrencies and Bitcoin and think they have long-term potential, these dips may be a good opportunity to add to your position or enter the market.

Also, remember not to make impulsive decisions based on short-term price fluctuations. Long-term investing success depends largely on strategy, patience, and discipline, rather than trying to predict short-term market dynamics.

Finally, I recommend that you always work with your trusted financial advisor to ensure that your investment strategy is consistent with your financial goals and risk tolerance. Everyone’s situation is unique, so it’s best to have personalized advice.