According to Cointelegraph: Bitcoin’s recent rally, which has propelled the price above $66,000, is renewing optimism for new highs. A combination of technical indicators, on-chain data, and investor sentiment suggest that Bitcoin (BTC) may be heading toward surpassing its previous all-time high of $69,000, with the potential for even more substantial gains in 2024. Here are five key metrics that support Bitcoin’s upward momentum.
1. All-Time High Bitcoin Open Interest Signals Market Liquidity Surge
Bitcoin’s open interest (OI) across all exchanges hit a record $19.7 billion on Oct. 15, as reported by CryptoQuant. OI, which measures the number of outstanding futures contracts, reflects increased participation and liquidity in the market.
Additionally, CoinGlass data reveals that Bitcoin’s OI-weighted funding rate has reached 0.0136%, a level not seen since June 7, 2023, when Bitcoin briefly hit $71,950. This suggests heightened bullish sentiment among traders, although it’s important to note that rising OI could also introduce volatility rather than indicating a definitive market direction.
2. Declining Bitcoin Supply on Exchanges Strengthens Bull Case
Data from CryptoQuant shows that Bitcoin reserves on centralized exchanges have dropped to 2.68 million BTC, a near-five-year low. This is a 20% reduction from the July 2021 peak of 3.37 million BTC, indicating that traders are increasingly holding onto their BTC instead of selling.
With Bitcoin’s year-to-date price growth exceeding 55%, the shrinking supply on exchanges aligns with long-term bullish behavior, as investors position themselves for potential future gains. A lower exchange supply typically reduces selling pressure, increasing the likelihood of sustained price rallies.
3. Record Spot Bitcoin ETF Inflows Show Growing Institutional Interest
Spot Bitcoin ETFs are playing a pivotal role in driving demand. According to SoSoValue Investors, U.S. Bitcoin ETFs recorded $555.8 million in net inflows on Oct. 14, marking the highest daily inflow since June.
ETF Store President Nate Geraci noted that institutional and advisory interest has steadily grown, with nearly $20 billion flowing into Bitcoin ETFs over the past 10 months. The rising demand for spot ETFs highlights Bitcoin’s growing acceptance among institutional investors, creating favorable conditions for future price growth.
4. Bitcoin RSI Suggests Potential Rally to $233,000
Bitcoin’s monthly Relative Strength Index (RSI), a key momentum indicator, hints at further upside. Analyst Bitcoindata21 applied historical RSI trends to predict that Bitcoin could reach $233,000 by the peak of the current bull cycle, likely in early 2025.
This projection aligns with previous cycle tops, where Bitcoin’s RSI reached between 88 and 90. If Bitcoin follows a similar pattern, six-figure levels could be within reach, reinforcing expectations of new all-time highs.
5. 200-Day SMA Breakout Supports Upward Trajectory
Bitcoin has successfully reclaimed its 200-day Simple Moving Average (SMA) at $63,335, a crucial technical level. Historically, breaking above the 200-day SMA has resulted in parabolic price movements, making this a significant milestone for Bitcoin’s recovery.
Data from IntoTheBlock indicates that Bitcoin sits on strong support within the $61,770 to $63,728 demand zone, where 1.1 million BTC were purchased by 2.5 million addresses. This suggests that the path of least resistance for Bitcoin is upward, with limited downside risk in the near term.
New Bitcoin Highs in Sight?
As Bitcoin begins what many are calling “Uptober,” the convergence of technical indicators, on-chain metrics, and rising institutional demand points toward the possibility of new highs. With open interest at record levels, ETF inflows surging, and a significant supply reduction on exchanges, the market sentiment is increasingly bullish.
While Bitcoin faces resistance at $68,000, a successful break above this level could pave the way for Bitcoin to challenge $70,000 and beyond. Analysts remain optimistic that, if current trends continue, Bitcoin could reach new all-time highs within the next few months, setting the stage for an explosive 2024.
