Bitcoin and other cryptocurrencies have started the month of October on a high note, breaking through an established trading range. Analysts are optimistic about the coming weeks, as October has historically been a good month for cryptos.
Over the past 24 hours, the price of Bitcoin has risen by 4% to $28,300, reaching its highest level in over a month. Bitcoin has mostly been stuck in a stagnant trading range around $26,000 since mid-August, with low volatility and trading volumes. This recent surge signals a return to the characteristic excitement surrounding Bitcoin.
Antoni Trenchev, founder and managing partner at crypto lender Nexo, commented on the recent price increase, stating, “October—or ‘Uptober’ as it’s known—is already living up its reputation as Bitcoin’s favorite month with Bitcoin rising to a six-week high.” However, Trenchev cautioned against getting too excited until Bitcoin breaks out of the $26,000 to $30,000 range, where it has been for most of the past six months.
There aren’t many immediate catalysts to explain the surge in Bitcoin’s price, but leverage building up in the Bitcoin futures market likely contributed to the momentum. Short positions worth $270 million, betting on a fall in prices, have been wiped out since last week, adding upside momentum to the rally.
Bitcoin’s performance in September has also set the stage for further gains in October. It outperformed the S&P 500 and Dow Jones Industrial Average, rising for the first September in seven years. Historical data suggests that this outperformance could continue in October.
In addition to Bitcoin, other cryptocurrencies have also seen gains. Ether, the second-largest crypto, jumped 3% to $1,730, while smaller tokens like Cardano and Polygon climbed 5% and 4% respectively. Memecoins like Dogecoin and Shiba Inu also experienced gains of 2%.
Overall, the crypto market is off to a strong start in October, with Bitcoin leading the way. The optimism among analysts is fueled by historical trends and positive momentum in the market. However, it remains to be seen if these gains will continue throughout the month.