Bitfinex analysts reminded investors in an interview yesterday (24th) that the current rebound in Bitcoin does not yet confirm the end of the long-term downtrend. Investors should continue to observe whether Bitcoin can break through the relative high of $65,200 reached on August 25th.
After briefly dipping to $62,700 last night at 22:00, Bitcoin rebounded again, reaching a high of $64,698 around 7 AM today (25th), seemingly on the verge of challenging the $65,000 mark. Currently, Bitcoin has slightly retreated, trading at $64,198 at the time of writing, up 1.98% in the past 24 hours.
Bitfinex Analyst: Key Resistance Level for Bitcoin at $65,200
Regarding the future direction of Bitcoin, Bitfinex exchange analysts reiterated in their interview yesterday (24th) that the current rebound does not confirm the end of the long-term downtrend. They emphasized the need for Bitcoin to surpass the high of $65,200 from August to confirm the end of the downtrend:
Bitcoin needs to break through the August high of $65,200 to confirm the end of the long-term downtrend. Currently, Bitcoin is very close to this resistance level. This level is significant because Bitcoin has been in a downtrend since reaching an all-time high of $73,666 on March 14 of this year; the $65,200 level, which is a high point before the decline in early September, once surpassed, would indicate that a bottom has officially formed.
Bitcoin has been in a downtrend since March
However, the analyst further added that Bitcoin’s trend in the short term may still lean towards consolidation, as buying pressure appears to have weakened recently:
It is entirely possible for Bitcoin to form a new consolidation range at the current price and oscillate for some time. As we observed earlier, the previous price increase was driven by spot buying, followed by the futures market, but spot buying has now slowed down. Once the price breaks through $63,500, spot trading volume is likely to stabilize further.
U.S. Stock Indices Rise Together
The People’s Bank of China proposed three major policies yesterday to boost the sluggish economy, leading to a comprehensive surge in A-shares and Hong Kong stocks. Chinese companies listed in the U.S. also experienced a wave of price increases last night. Coupled with investors’ optimistic sentiment regarding interest rate cuts, U.S. stocks closed higher on the 24th, with both the Dow Jones and S&P 500 indices hitting new historical highs.
The Dow Jones Industrial Average rose by 83.57 points, or 0.20%, closing at 42,208.22 points, marking its fourth consecutive trading day of setting new highs.
The S&P 500 Index increased by 14.36 points, or 0.25%, closing at 5,732.93 points.
The Nasdaq Index rose by 100.25 points, or 0.56%, closing at 18,074.52 points.
The Philadelphia Semiconductor Index climbed by 65.97 points, or 1.31%, closing at 5,091.78 points.
Matrixport: Bitcoin Volatility Expected to Continue Declining
Additionally, Matrixport released a new research report on Twitter yesterday, stating that Bitcoin’s price has essentially remained within a ±20% volatility range over the past 18 months. With the introduction of Bitcoin ETF-related options and the participation of institutional investors, Bitcoin’s volatility is expected to be further compressed, leading to a recommendation for investors to adopt a volatility-selling strategy to gain additional returns:
Although Bitcoin inherently exhibits volatility, the 30-day rolling return rate shows that its price has largely maintained a ±20% fluctuation range over the past 18 months. We anticipate that volatility will further decrease; thus, we recommend adopting a volatility-selling options strategy, including selling out-of-the-money put and call options for additional income.
Even though this strategy may incur losses, it remains effective overall due to the general downward trend in volatility. With the launch of Bitcoin ETF-related options, more institutional participants are expected to enter the market, further compressing volatility. Therefore, selling volatility remains a viable strategy for Bitcoin holders to obtain additional returns.