Bitcoin (BTC) is set to “take back the shine” as BTC price begins to catch up with the US stock market, according to a new analysis. In a post published on October 19, Caleb Franzen – founder of financial analytics platform Cubic Analytics – saw the potential for a strong breakout in Bitcoin.
‘Highly Effective’ Pricing Tool Signals BTC Will Continue Rising
Bitcoin (BTC) needs to recover to catch up with the performance of US stocks, as the S&P 500 index continues to set new highs.
Franzen compared the BTC/USD pair to the Invesco S&P 500 Equal Weight ETF (RSP) and said that the current situation is showing clear signs.
“On a correlation basis, Bitcoin has not yet made a new high relative to RSP. In fact, BTC/RSP was rejected right at the old high from 2021 and has been consolidating since then. I have illustrated this with a regression channel,” Franzen wrote with an illustrative chart.
“However… BTC/RSP pair is starting to break out above that regression channel.”
Franzen sees a trading opportunity for investors by shorting RSP and buying BTC.
“Based on this structure, the current breakout suggests a potential return to the green zone,” he continued.
“It should be noted that the blue zone could still be a potential resistance zone, but also a price target.”
Franzen further added to the optimism by using the Williams%R Oscillator, a tool that measures trend strength across multiple timeframes.
The 120-day version of the tool showed bullish signals, as BTC recovered from oversold territory in July.
“As we see, this signal is rare and extremely effective,” Franzen concludes.
Similar bottom signals appeared in January 2024 and October 2023. On both occasions, BTC/USD increased by 48% and 123% over the next three months.
“Now that Bitcoin is trading at its highest level since July 2024, investors are slowly regaining confidence in the possibility of continued growth, especially when the stock market is at an all-time high,” the article emphasized.
Bitcoin breakout expectations are growing higher
According to a report from Bitcoin Magazine, BTC price predictions suggest that Bitcoin could hit a new macro peak by 2025, while the short-term outlook remains bullish.
Currently hovering around $69,000, Bitcoin must overcome its final resistance level to enter a new phase of price discovery – a resistance level that has held since March.
For the first time since then, BTC closed the daily candle above the descending parallel channel, creating positive momentum for the market.
Over the weekend, prominent analyst Rekt Capital emphasized the importance of Bitcoin’s current price movements.
“History was made when Bitcoin closed its first daily candle above the red resistance zone,” he shared on social media X with an explanatory chart.
“Bitcoin will attempt to retest the top of this resistance zone and turn it into new support. Overall, Bitcoin only needs to stay above $66,400 (top of the black channel) to close the weekly candle with a bullish bias.”
