Bitcoin Price Movement: Where to Next?
Bitcoin (BTC) is starting the second week of November on a strong note, with the largest cryptocurrency holding near 18-month highs. Despite sell pressure, Bitcoin and altcoins are not retracing their gains, signaling a change in sentiment. With potential volatility triggers on the horizon, market participants are hopeful that the upside is not yet over.
Fed Speakers and Market Volatility
The United States Federal Reserve is set to deliver remarks, including Chair Jerome Powell, leading to potential market volatility. With attention on the Fed, investors are eager to see if there will be any changes in interest rate hikes. Recent data showing inflation beating expectations has left room for speculation, but bets for the next rates decision are for a repeat pause.
Bitcoin Network Fundamentals Reach New Highs
Bitcoin's hash rate and mining difficulty have reached all-time highs, canceling out any declines and solidifying the network's strength. The upcoming adjustment will further increase the difficulty level, while the hash rate continues to trend upward. This trend indicates miners' confidence in the network, with expectations that BTC/USD could trade at $46,000 by the time of the upcoming block subsidy halving.
Shift in Bitcoin Exchange Flow
There is a notable shift in Bitcoin exchange flow as profitability conditions change for hodlers. Withdrawals from exchanges are nearing year-to-date highs, while inflows take a back seat. This suggests a shift in investor sentiment, with more investors opting to hold their assets long-term instead of seeking immediate liquidity on exchanges. Aggregate capital inflows have also reached year-to-date highs, indicating strong investor confidence.
Crypto Fear & Greed Index Reaches Highs
The Crypto Fear & Greed Index, a market sentiment indicator, is showing increasing greed among investors. As Bitcoin reached all-time highs, the index hit 84/100, just 10 points below its peak. This indicates a profit-focused mindset among hodlers. However, there is still room for further upside before the sentiment becomes extreme. The historical extremes of the index have been around 95/100.
Please note that this article does not contain investment advice or recommendations. Readers should conduct their own research before making any investment decisions.
