Bitcoin price stagnant as analysts anticipate October rally

Brian McGleenon

Bitcoin’s (BTC-USD) price was largely flat on Thursday, posting a modest 3% gain over the past week despite supportive macroeconomic conditions, including China’s recent stimulus measures and a US Federal Reserve rate cut. However, analysts are optimistic about a potential rally in October and throughout the fourth quarter of 2024.

The price of bitcoin stood at $63,850 (£47,867) on Thursday, according to data from CoinGecko.

Historical data indicates that bitcoin often performs well in October, with average returns of plus 22.9% and median returns of plus 27.7% since 2013, Bitfinex analysts said.

“October has typically been a strong month for bitcoin, with only two negative closes in 2014 and 2018, both of which were during bear markets following red September closes,” they told Yahoo Finance UK.

Read more: Crypto live prices

Bitcoin is up around 7.8% for the month of September.

However, price swings should also be expected over the coming weeks, according to analysts. “Price could very well drop 10% before recovering and closing the month in the green. Recent years have seen peak-to-trough drawdowns in October exceed 6%,” the analysts said.

“Amid macro shifts and institutional adoption, digital assets are poised for continued growth in Q4. As sovereign balance sheets face pressure, investors will seek long-term hedges like bitcoin,” CF Benchmarks lead research analyst Gabriel Selby said in a note.

“The expected performance of bitcoin in October is anticipated to surpass that of September, with a target price range of $58,000 to $72,000,” Bitget research chief analyst Ryan Lee said.

Lee pointed to several indicators from the derivatives market, including multiple instances of negative funding rates in bitcoin futures throughout September and the Fear & Greed Index lingering in the "extreme fear" zone. “Historically, these factors often precede significant rebounds,” he added.

Read more: What are bitcoin ETNs?

Institutional players are set to be significant drivers of this potential growth. “MicroStrategy (MSTR) continued to sell bonds in September to purchase more bitcoin, and bitcoin exchange-traded funds (ETFs) saw continued net inflows following interest rate cuts,” said Lee

"This indicates that institutions are optimistic about the market outlook.” He noted that ongoing institutional buying could help bitcoin break previous highs.

Looking ahead, Selby identified potential changes in the US regulatory landscape after the presidential election on 5 November as a factor that could foster an environment ripe for crypto activity. “We see conditions fostering investor confidence and driving capital formation,” he said.

“Layer 2 scaling solutions are rising to meet the growing demand for ethereum (ETH-USD) block space, while traditional financial institutions explore the tokenisation of real-world assets on ethereum.”

The emergence of generative artificial intelligence and the accompanying demand for GPU computing power could also benefit decentralised physical infrastructure networks (DePINs), which democratise access to high-quality computing resources, he added.

Download the Yahoo Finance app, available for Apple and Android.

Advertisement