The monthly Bitcoin price candle closed above $13,000 for the first time since 2017, when BTC reached its all-time high of nearly $20,000.
Bitcoin’s monthly candle (BTC) for October closed above $13,000 for the first time since December 2017. This comes after the daily and weekly candles closed above the crucial resistance level.
Traders often use the monthly logarithmic chart to evaluate the macro and long term trend of an asset. On a monthly chart, each candle represents a full month of trading activity. As such, a Bitcoin monthly log chart usually covers many years of activity.
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The monthly chart is considered one of the main charts for longer time frames next to the weekly chart. A clear break above a major level, such as USD 13,000, on the monthly chart signals a technical break.
The Bitcoin monthly chart. Source: TradingView.com
Exceeding $13,000 means $20,000 is close
As Cointelegraph reported earlier, Cathie Wood of Ark Invest emphasized the importance of the $13,000 level.
Wood, who manages USD 11 billion in assets under management at Ark Invest, said there is little resistance between USD 13,000 and USD 20,000. This means that if Bitcoin comes out of a longer time frame chart, the probability of going up to a new high could be higher. She said:
She said: „That [level] of USD 13,000 is important because if we break it, then, in technical terms, there would be very little resistance and we would probably be on our way back to the peaks we saw in late 2017, so, around USD 20,000. Now, we’re not sure if that’s going to happen. We could remain in a new trading range, only at a slightly higher level than the last six to 10.
Although the Bitcoin price reached USD 20,000 in 2017 and USD 13,970 in 2019, the monthly candlestick never closed above USD 13,000. That’s because BTC experienced strong rejections during both peaks, rejections that later shook the market.
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The recent rise is particularly optimistic as it has shown a more sustainable trend similar to an upward ladder. As the price rose, it established clear support levels, which made the movement more stable.
What do traders expect in the short term?
In the immediate future, traders are preparing for a small setback. Technically, the Bitcoin monthly chart closed significantly above the key short-term moving averages.
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A pseudonymous trader known as „Loma“ said that BTC would probably fall to about USD 13,100 and resume the rally. The 5-day moving average on the Bitcoin monthly chart is at USD 12,256, so a drop to USD 13,000 would be healthy for the movement. Loma wrote:
„The game plan is that we’re going to explode at $BTC to USD 12,900 – USD 13,000, which is enough for the shorts to build up waiting for a new test of the USD 12,000 – USD 12,400, then use them as nuclear fuel to drop the larger bearnuka candle upwards leaving the shorts in Landia Liquidation“.
Similarly, Michael van de Poppe, a full-time trader at the Amsterdam Stock Exchange, said a drop below $12,000 could also occur.
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As Cointelegraph reported, a drop in the Bitcoin price as we enter November would put even more pressure on the altcoin market. Bitcoin has absorbed most of the volume of the cryptcoin market, which means that if BTC drops, the selling pressure on altcoins would probably intensify.