This is a technical analysis post by CoinDesk analyst and Chartered Market Technician Omkar Godbole.
Bitcoin traders, pull up the monthly candlestick chart, which is waving the white flag of indecision like never before, and October’s candle says it all.
The October candle represents a huge trading range, from around $103,600 all the way up to over $126,000. That’s a spread greater than the previous three months combined! Still, BTC ended October with a modest decline of 3.8%. When prices fluctuate wildly, but the period in question ends close to where it started, it’s what some traders call a “decision candle.”
A bull would see this as base building – a quiet moment before the next big leap up. This is possible because BTC’s ongoing bull run since early 2023 has been a classic “stair-step” rally. Also, historical BTC tops tend to form sharp, inverted V-shaped breakout movements. So maybe it’s gathering bullish steam. But there is a catch.
This indecision is happening at a key point: the trend line connecting bitcoin’s record highs of 2017 and 2021. Record highs are where buyers usually flex their muscles, but right now they’re hesitating. And the monthly MACD histogram, an indicator used to measure trend strength and changes, confirms this slowdown in upward momentum as it produces smaller peaks above zero instead of new highs.
Notably, last month’s new price high did not get MACD’s blessing, creating a bearish divergence that echoes the warnings seen at previous peaks, like the famous 2021 high.
Throw in the fact that this uncertainty persists despite bullish news like fat interest rate cuts and better US-China trade relations, and the case for bulls starts to look shaky.
And if that’s not enough, bitcoin’s stuck-in-the-mud feeling right now mirrors the indecision we’re seeing in the US dollar index (DXY) after its own big downtrend. DXY looks poised for a reversal and may rise soon, historically putting pressure on bitcoin’s rally.
Where does that leave us? If momentum slows and buyers can’t push through resistance, BTC could see a pullback to around $100,000 or lower before attempting the next big move. Conversely, a renewed move above $116,000 would be needed to reconsider the bullish outlook.
