Bitcoin, referred to in the market as BTC, is experiencing a positive September despite the usual negative returns associated with the “September Effect.” Traders and investors are now eagerly anticipating the arrival of “Uptober,” which historically has been a favorable month for the market.
According to data retrieved by Finbold from CoinGlass on September 25, Bitcoin has recorded almost 8% gains so far this month. In contrast, October has shown average and median returns of 22.9% and 27.7%, respectively, since 2013, underscoring its reputation as a positive month. In comparison, the “September Effect” typically leads to negative returns for the current month.
In historical analysis, Bitcoin has demonstrated notable performance during Uptober, with gains of 28.52% in 2023 following a 3.91% September. Interestingly, Bitcoin has only experienced two losing Octobers in its history, one in 2014 with a decline of 12.95% and another in 2018 with a 3.83% decrease.
Despite the positive outlook, it is essential for Bitcoin to clear retail traders’ long positions before the market transitions into Uptober. This strategic move is crucial to satisfy the liquidity needs of whales, market makers, and institutional traders who often capitalize on market trends.
Observing the liquidation heatmap for the past two weeks, there are significant liquidity points at $62,000 and $57,000, which are potential targets for major players in the market. While Bitcoin could theoretically shift into Uptober mode without addressing these levels, considering the strong pull of liquidity pools is advisable as it could lead to a significant downward move before any upward trajectory.
In the current scenario, Bitcoin is trading at $63,380, potentially signaling a forthcoming downside move. Despite this, BTC is following a short-term uptrend characterized by higher lows and higher highs in the seven-day timeframe.
Prominent analysts anticipate a correction in Bitcoin’s price before it can embark on a full bull run. Some experts, like Alan Santana, emphasize the necessity for Bitcoin to undergo a significant correction and establish a solid bottom before the onset of Uptober.
In conclusion, while Bitcoin may face downward pressure in the near term, paving the way for sustainable growth in October could potentially solidify its historical trend of positive performance and usher in another successful Uptober in 2024.