Bitcoin (BTC) monthly chart is set to complete its first bullish engulfing pattern in 18 months within 48 hours, Cointelegraph reported. The last time this occurred was in January 2023, marking the 2022 bear market bottom.

Although Bitcoin’s long-term trend is bullish, recent signs point to the possibility of downside volatility in the short term. BTC has risen parabolically since bottoming out on September 6, breaking out of its previous lower highs pattern.

Meanwhile, Bitcoin’s open interest (OI) has increased rapidly, reaching $35 billion on September 27, comparable to highs seen in February and July 2024. While open interest suggests that futures markets are still dominating price action, flat funding rates suggest that perpetual traders remain “hesitant.”

Independent trader Adam pointed out that the spot order book is deeply biased towards sellers, and spot traders are currently actively selling at the $66K resistance level. Therefore, there is a high probability that BTC will see downside volatility in the coming week.

From a technical perspective, “Uptober” could start with a short-term pullback, forming a higher lows pattern. BTC’s 4-hour chart shows a bearish divergence between its price and the relative strength index (RSI).

From the current price, an immediate pullback to $62,300 or a 4.66% drop is possible. If the pullback persists, the next area to test is the order block between $59,500 and $61,000.

The EMA-50, 100, and 200 levels also support a drop to $61,000, which means this is the lowest range of correction expected within the coming week. A daily close below $60,000 could jeopardize the current bullish momentum.