Bitcoin, also known as BTC, is defying the typically negative September trend referred to as the “September Effect” by posting positive gains this month. Traders and investors are now anticipating the upcoming positive month of October, often referred to as “Uptober” in the market. Data from CoinGlass retrieved on September 25 shows that Bitcoin has gained almost 8% so far this month.
Historically, October has shown average and median returns of 22.9% and 27.7% respectively since 2013, hence the optimistic nickname. In contrast, the “September Effect” usually results in negative average and median returns for the month.
In 2023, Bitcoin witnessed a significant 28.52% increase from the start to the end of Uptober following a challenging September period. Notably, Bitcoin has only experienced two losing Octobers in its history, in 2014 and 2018.
Before entering Uptober, it is crucial for Bitcoin to address the large retail positions to prevent potential downside risks. This is because clearing these positions is necessary to provide liquidity for whales, market makers, and institutional traders to benefit from market movements.
Analyzing the liquidation heatmap reveals key liquidity points to watch, particularly at $62,000 and $57,000 levels. While Bitcoin can transition into Uptober mode without clearing these levels, the presence of liquidity pools suggests a possible downward move to eliminate long positions before an upward trend.
Despite the current price of Bitcoin at $63,380 and signs of a potential downside move, short-term trends show higher lows and higher highs in the seven-day timeframe. Analysts anticipate lower prices before Bitcoin can reach its full bullish potential, with a focus on establishing a strong foundation for growth in October.
Experts emphasize the need for Bitcoin to experience a significant drop before the start of Uptober, acknowledging the potential for altcoins to perform well in the interim period. Analysts foresee an upcoming altseason for mid and small-cap altcoins as they break out of a downtrend.
Overall, Bitcoin’s performance may witness fluctuations before stabilizing for growth in October, aligning with its historical positive trends and potentially setting the stage for another successful Uptober in 2024.