Bitcoin Reaches $66K: Is a Big Rally Just Beginning?
This rise comes after weeks of volatility, with the global economy and geopolitical tensions—especially in the Middle East—playing a significant role. A key factor in Bitcoin's recent momentum is the global reaction to China’s latest economic updates. Despite China’s efforts to boost its economy, doubts remain about whether these measures are enough. As Bloomberg reports, some investors are moving out of Chinese stocks and into Bitcoin, seeing it as a safer bet.
Caroline Mauron, co-founder of Orbit Markets, mentioned that capital flow from Bitcoin into Chinese equities had previously held Bitcoin back. With this shift easing, Bitcoin is benefiting from renewed interest.
Adding to the positive sentiment, Mt. Gox, a once-bankrupt crypto exchange, postponed its creditor repayment deadline by another year, reducing fears of a major Bitcoin sell-off. This delay has calmed market concerns, allowing Bitcoin to continue its upward trajectory.
Moreover, October, often referred to as “Uptober” in the crypto community, has historically been Bitcoin’s best-performing month. Since its the inceptions, Bitcoin has average at 21% gain in October month, although it did a face setback in 2014 and 2018.
What’s Driving the Current Momentum?
Several factors are fueling Bitcoin’s recent gains. One major indicator is the increase in inflows into spot Bitcoin exchange-traded funds (ETFs). After a period of outflows, Bitcoin ETFs saw a substantial shift on October 11, recording their largest inflow in two weeks, exceeding $253 million. This uptick signals a renewed confidence from investors, particularly institutional ones, which bodes well for Bitcoin’s future.
The U.S. presidential race is also influencing Bitcoin's rise. Prediction markets are now favoring pro-crypto Republican candidate Donald Trump over Democratic Vice President Kamala Harris. As of mid-October, Trump holds a 54% chance of winning, while Harris’s odds have dropped to 45%, a low point for her campaign. Many in the crypto community view a potential Trump victory as positive for the industry, expecting more favorable regulations.
MicroStrategy, one of Bitcoin’s biggest corporate supporters, has also contributed to the positive sentiment. The company, led by Michael Saylor, has seen its stock soar by 1,620% since adopting a Bitcoin-centered strategy in 2020. Saylor remains bullish on Bitcoin, recently stating, “the only thing better than Bitcoin is more Bitcoin.”
However, Bitcoin mining has faced mixed results. Despite Bitcoin’s price rising by 5% this month, the network’s hashrate has increased by 11%, slightly reducing miners' profitability. Analysts at Jefferies have noted that miners’ revenue fell by 2.6% in September, and October may prove challenging unless prices continue to rise.
Bitcoin is also benefiting from recent moves by the Federal Reserve. In September, the Fed cut interest rates by 50 basis points, lowering the benchmark rate to 4.75%-5.00%. Further cuts are expected in November and December, which could drive more investors toward Bitcoin, as lower interest rates generally favor risk assets.
What’s Next for Bitcoin?
Looking at the broader market and crypto-specific data, some key insights point to Bitcoin's potential direction.
Whale investors—those holding large amounts of Bitcoin—are accumulating more BTC in the $55,000 to $60,000 range. According to IntoTheBlock’s data, Bitcoin faces minimal resistance in this range, with over 4.3 million BTC held in profitable positions, indicating strong support.
Crypto analyst Michaël van de Poppe believes that Bitcoin’s recent test of $62,000 is a sign of a larger move to come. He predicts that a test of $64,000 will likely lead to a major breakout, potentially pushing Bitcoin even higher.
As whale accumulation continues and market sentiment improves, Bitcoin’s current momentum may be setting the stage for a significant rally in the coming weeks.
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