Bitcoin (BTC) Price Holds Intraday Highs Above $62K as Q4 Rally Hopes Emerge

Bitcoin (BTC) moved to an intraday high of $62,338 on Oct. 4 as stronger-than-expected jobs data for September and bullish onchain metrics

Bitcoin price reached an intraday high of $62,338 on Oct. 4 as stronger-than-expected jobs data for September and bullish onchain metrics set the stage for a potential rally in the fourth quarter.

BTC/USD daily chart. Source: TradingView

According to the Bureau of Labor Statistics, nonfarm payrolls increased by 254,000 in September, significantly higher than the anticipated 147,000 gain. During the same period, the unemployment rate fell to 4.1% from 4.2% in September, compared with expectations for no change.

As a result, market participants now price in a 97% probability of a 25 basis point interest rate cut at the Federal Reserve’s next meeting on Nov. 7, following an aggressive half-point move in September, according to data from CME Group’s FedWatch tool.

Another possible driver behind the idea of an “Uptober” and a fourth-quarter rally for Bitcoin is the continued decrease in BTC held on centralized exchanges.

Data from CryptoQuant suggests there are over 2.8 million BTC in total on centralized exchanges, which marks the lowest amount since November 2018 and less than 500,000 BTC compared to March.

Bitcoin balance exchanges. Source: CryptoQuant

While not a perfect measure, the metric indicates the number of BTC coins that are being held in known exchange wallets, and a low balance often indicates a decreased amount of available liquidity, which, in some scenarios, tends to precede bullish price movements.

The data shows that the exchange balance fell by 12% over the past six months, during which time Bitcoin has been trading within a broad range between $50,000 and $72,000. The decline in exchange balances is also relatively similar to that seen between March 2020 and November 2020, before Bitcoin embarked on an extended rally that culminated in a new all-time high of $69,000 in late 2021.

If history repeats itself, the declining Bitcoin reserve on exchanges could be a precursor to BTC price rallying to new record highs.

Another possible headwind for Bitcoin as Q4 unfolds is increasing institutional demand through the US-based spot Bitcoin ETFs.

Related: Buying this Bitcoin dip is a ‘no-brainer’ — Hedge fund manager

Additional data from CryptoQuant reveals that institutional investors went from selling a net 5,000 BTC on Sept. 2 to an average buying an average of 7,000 BTC by the end of September. This marks the highest daily purchase of these investment products since Sept. 21, when net buying was above 9,000 BTC. This demand helped propel Bitcoin prices to an all-time high of $73,835 in Q1 2024.

Daily change in total spot Bitcoin ETF holdings. Source: CryptoQuant

Before embarking on the much-anticipated Q4 rally, crypto analyst Timothy Peterson believes Bitcoin price may first drop to rest the adoption curve at $57,000.

Source: Timothy Peterson

This article is for informational purposes only and not intended as investment or financial advice.

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