Key points:
Bitcoin is encountering three moving averages simultaneously on the daily chart after the gains at the start of the week.
The significance of reclaiming these averages is heightened by the monthly and quarterly closes, according to analysis.
Several factors contributing to BTC price volatility are emerging this week.
Bitcoin (BTC) is currently facing three “key” moving averages, and its ability to sustain a bull run may hinge on overcoming these levels.
Recent analysis shared on Monday by Keith Alan, co-founder of trading platform Material Indicators, emphasizes the importance of monitoring the upcoming daily closes.
Bitcoin bulls aim for three support levels
Despite a notable bounce from around $109,000 at the beginning of the week, Bitcoin bulls are not yet in a secure position.
Alan highlights a cluster of simple moving averages (SMAs) forming a compact area as he discusses the current market dynamics.
The 21-day, 50-day, and 100-day SMAs have all converged at the same point, which coincides with the current spot price.
“They’re all really closely wound right now,” he noted during a video update on X.
As of this writing, data from Cointelegraph Markets Pro and TradingView shows BTC/USD trading just above the 50SMA but below the other two, having closed above all three trend lines on Monday.
“It’s not how you start the day; it’s not even what happens in the middle; it’s how you finish,” Alan advised.
He encouraged viewers to observe whether the SMAs get flipped to support next, labeling this as a “key thing to watch.”
A potentially volatile monthly close
In this state of flux for BTC/USD, the catalysts for volatility are more important than ever.
Related: Bitcoin traders anticipate $110K CME gap dip next as BTC price rises 1.5%
As Cointelegraph reported, an array of US macroeconomic data is set to come out throughout the week, most of which pertains to employment.
Weakness in the labor market is a major concern for policymakers, influencing the Federal Reserve’s strategy for interest-rate cuts.
Add to this the looming threat of a US government shutdown starting Oct. 1, which introduces further uncertainty regarding short-term risk-asset performance.
Moreover, the monthly and quarterly candle closes are approaching.
“A daily candle close above the 21-Day SMA would signal strength, but only if it holds through the monthly open,” Alan added in this context.
This article does not constitute investment advice or recommendations. All investment and trading activities carry risks, and readers should perform their own research before making any decisions.
