The pioneer cryptocurrency remained stagnant during the third week of October.
Bitcoin Remains Dormant While Traders Wait for Volatility
It kicked off on Monday, October 12th, trading at $11,374, and closed Friday, October 16th, at $11,372. The bulls nor the bears could control BTC’s price action, showing indecision among market participants.
Due to the dormant price action seen during the week of October 12th, Bitcoin’s volatility took a significant hit. The 60-day average dropped to a low 1.17% after hovering around 1.37% just a week before. This fundamental index’s considerable decline implies that the flagship cryptocurrency is preparing for a significant price movement.
But for now, it seems like the $11,250 support and the $11,560 resistance levels will play a key role in determining where BTC will be headed next. These price hurdles were able to contain the pioneer cryptocurrency throughout the entire week of October 12th. Bitcoin’s inability to move past these barriers forced the Bollinger bands to squeeze on the 4-hour chart, adding credence to the thesis that volatility is about to strike back.
Since BTC could go in any direction at the moment, it is imperative to wait for a clear break of the support and resistance levels previously mentioned. Until this happens, the area between $11,250 and $11,560 is a reasonable no-trade zone. A breakout may push Bitcoin towards the infamous $12,000 mark, while a breakdown will likely see it crash to $10,700.
Ethereum’s Investors Suffer a Weekly Loss of 2.30%
While Bitcoin remained stationary throughout the past week, Ethereum saw its price retrace by 2.30%. The smart contracts giant opened Monday, October 12th, at $374.4, and a few hours later, it was trading at a low of $365.80. This support level was significant enough to allow prices to rebound over 8% and hit a weekly high of $395.20.
Nonetheless, Ethereum spent the rest of the week losing the substantial gains incurred. On Tuesday, October 13th, ETH closed 3.50% lower than the high of $395.20. On Wednesday, it shredded another 0.62%, and during the last two days of the week, the losses increased to 3.70%.
By Friday, October 16th, the second-largest cryptocurrency by market cap was hovering around the $370 support level. But as the bears continue in charge of the price action, ETH closed the week at $365.60. Investors incurred a weekly loss of 2.30% due to the downward trend seen throughout the week of October 12th.
Now, traders should pay close attention to the $365 support and the $390 resistance levels. Given the past few weeks’ price behavior, these critical points could help determine where Ethereum will be headed next. Slicing through support could see ETH drop to $300, while breaking through resistance may see it rise towards $450.
On the Cusp of a Price Explosion
Even though Bitcoin and Ethereum seem to show indecision in terms of the direction of their trends, the fundamentals behind these cryptocurrencies could not be better. Not only publicly traded companies are adding BTC to their balance sheets, but CFTC Chairman Heath Tarbert said to be “impressed” by the progress ETH has made to become the “world’s computer.” Such an endorsement is quite significant as it shows that the mass adoption of these digital assets is happening right now.
There are still many hurdles that both Bitcoin and Ethereum would have to overcome. However, the willingness of the U.S. financial watchdog’s to talk openly about how “revolutionary” they are is a clear sign that cryptos are here to stay. Therefore, it may just be a matter of time before BTC and ETH resume their historic uptrends and march towards new yearly highs.
Executive Director at CEX.IO. His area of responsibility includes customer relationships with institutional and VIP-clients, overseeing the creation of the company’s development strategy, new products, markets and partnerships. As a member of the board of directors, Konstantin is also responsible for corporate governance.