Bitcoin’s 6% drop since September 30 should be seen as an opportunity for investors to accumulate more BTC, according to Quinn Thompson, chief investment officer at Lekker Capital.
In an October 3 post on X, Thompson argued that buying Bitcoin (BTC) at its current price of $61,000 is a no-brainer, emphasizing that the macro backdrop of price action for the Cryptoasset has changed significantly compared to previous dips.
Source: Quinn Thompson
He attached a chart of Bitcoin 's price action from March 5 of this year, when BTC hit a new record high of $73,700.
Thompson pointed to three previous similar setups where Bitcoin's price plummeted and then dropped below its 200-day moving Medium — a key technical indicator used by traders to gauge the medium-term strength of certain assets.
This time, however, BTC bounced sharply off that technical level, a move that Thompson said showed clear invalidation against a 180-degree macro backdrop, hinting that prices could soon reverse upwards.
“I don't usually take a short-term view, but it seems like a no-brainer to bet on this area.”
Escalating geopolitical tensions in the Middle East sent markets into turmoil earlier this week, as risk assets like Bitcoin sold off sharply as Iran launched military action against Israel.
Growing concerns about the strength of the US economy and uncertainty surrounding the outcome of the US election in November have also weighed on risk assets.
Meanwhile, mentions of the term “Uptober” — a nickname given to October given its historically bullish cryptocurrency price action — have plummeted across social media as the market continues to retreat.
Following Thompson's line of thinking, other analysts say the recent lack of optimism creates an opportunity for a short-term bounce.
“The Uptober excitement is fading as the market declines, opening the door for a recovery. Whether the larger downtrend is over remains to be XEM,” said Santiment founder Maksim Balashevich.
While October is known to be a strong month for big returns with an Medium gain of over 20% over the past 11 years, the majority of these returns typically occur towards the end of the month.
October and November are typically the best months for Bitcoin price performance. Source: CoinGlass
In the first half of October 2023, Bitcoin fell 7% to $26,650 but rallied nearly 30% in two weeks to end the month at $34,500, leading some traders to think of a potential surge later this month.
