Rising back to $14,000 in July, the Bitcoin (BTC) price experienced a sharp rise since its last major price movement in April. However, the surge was followed by a significant correction which resulted in a price of $10,000 around September before ultimately falling to older lows of $8,000 in October. As such, the price movements resulted in a drop of almost 50% since July, with ongoing uncertain market sentiment.
Bullish or bearish, Bitcoin is poised for a major price movement which will pull it out of its sideways trend. When its value suddenly received a small surge, the crypto community believed in the revival of Bitcoin and that a continuous upwards price movement would bring the market out of its bearish phase. However, the mini-surge did not experience much momentum which ended with the Bitcoin (BTC) price falling back to its $8,000 support level.
When applying technical analysis, it seems that Bitcoin is set for another major price movement. Reported by Bloomberg, the ‘Trading Envelope’ indicator is at its narrowest since last month. The indicator represents the difference between the asset’s lower and upper band. The Trading Envelope indicator narrowed in September prior to the Bitcoin (BTC) price plummeting. However, the indicator has narrowed as well during June prior to its surge towards $14,000.
According to some views, Bitcoin’s market revival is based on Facebook’s vision to deliver a global cryptocurrency named Libra that will help deliver cross-border transactions. However, the project faced heavy criticism due to being managed by Facebook, which in return resulted in regulatory scrutiny from all corners of the world. With another congress testimony by Zuckerberg and several members leaving the Libra Association, the project’s future is more uncertain than ever.
Apart from tech giants, institutional investors may represent another way of the cryptocurrency market to gain traction. The launch of Bakkt in September is believed by some to be the short-term shortfall of the market as a low level of initial adoption resulted in bearish market sentiment. With only a daily trading volume of an average of 70 Bitcoins, Bakkt has not met the high expectations that a large part of the market held.
Despite this, at the moment, institutional investors believe that the Bitcoin (BTC) price will increase and are doubling the value of their long positions in their bitcoin futures contracts. According to research data from market analyst platform Skew Markets, the value of long positions made by institutional investors increased from 500 Bitcoins at the start of October to 1,000 on the 16th of October.
Furthermore, institutional crypto asset manager Grayscale recently announced that investors are continuously pouring their funds into Bitcoin in 2019. Apart from the halving event set for May 2019, there is nothing that will result in Bitcoin (BTC) price movements that are organic in the mid-term. However, a significant influx of institutional interest and money will contribute to this factor if soon established. As a reminder, the CME Group plans on launching a bitcoin options trading platform in 2020.