Bitcoin has been relatively sluggish this week due to a noticeable decline in trading activity. There's a significant price consolidation in the range of $27k–$27.5k, and BTC is currently successfully holding this area, reinforcing the belief in a potential bullish surge to $28k. This could create favorable conditions for a bullish breakout in the near future to establish support above $28k for further movement towards $30k.
However, it's worth looking at this perspective with a degree of skepticism. Typically, weekends see reduced trading activity, which could hinder further cryptocurrency growth. Consequently, even if Bitcoin shows some signs of growth, its momentum may slow down over the weekend, failing to reach the desired target of staying above $28k.
Fundamental Factors
Investors' main focus this week is on the labor market and the gradual reduction in the number of unemployed. Data on unemployment dynamics, hourly wage changes, and vacancies provided by the U.S. Bureau of Labor Statistics will provide clarity on the state of the labor market. Potential wage growth and the expected decrease in unemployment could indicate increased inflationary tendencies due to employers competing for labor.
Investors interpreted this as a sign that demand for goods and services in the U.S. remained high in September due to sustained economic growth. This could provide the Federal Reserve with a basis to consider raising interest rates at the November 1st meeting. This, in turn, could have a negative impact on high-risk assets, particularly cryptocurrencies and stocks.
At the same time, leading U.S. banks point to the effective impact of the Fed's monetary policy. Citi analysts note that despite strong labor market data, there is a consistent and increasing slowdown in consumer spending in the U.S. this year. However, experts believe that the process is progressing relatively slowly, which may trigger another interest rate hike or even longer maintenance of current rates into 2024.
BTC/USD Analysis
On October 5, Bitcoin unsuccessfully tested the $28k–$28.1k range and began to decline towards the local support level at $27.5k. There is a gradual decline in price highs during attempts to breach the $28k level. This could indicate strengthening bearish volumes or a general decline in trading activity leading into the weekend. Despite the unsuccessful retest of $28k, Bitcoin is holding confidently at the $27.5k level.
As of October 6, the cryptocurrency is trading near the $27.5k level with daily trading volumes of $11.6 billion. At this stage, there is a local surge in trading activity during the upward movement of the BTC price. This is a positive signal indicating consistently high bullish volumes, which could ultimately lead to breaking the key target for the current week at $28k.
Technical metrics continue to maintain strong positions in the bullish zone, confirming the presence of buyers. When it comes to local levels, the battle between bulls and bears is taking place in the range of $27k–$28k. However, in terms of more fundamental milestones, the bullish idea for BTC, with the potential to reach $30k, remains valid as long as Bitcoin holds above the downward trendline at $26.6k. If this zone is breached, the price could retest the $25k level with the prospect of further declines.
Conclusion
Large buyers continue to show interest in BTC, and miners have increased their holdings by 35% compared to September. Meanwhile, the price remains below the 200WMA, which is a good place for long-term purchases. In terms of short-term targets, BTC is currently closer to breaking the $28k level, with further movement toward $30k. However, a decrease in trading activity over the weekend may delay the successful break of this level. Therefore, we expect BTC to consolidate in a narrow range between $27.5k and $28k until the end of the current week.
