Bitcoin (BTC) is nearing its all-time high (ATH), causing bulls to get excited. However, veteran analyst Peter Brandt advises caution, urging bulls to remain excited while avoiding dogmatism.

Bitcoin breakout not yet confirmed

After a delicate start to October – historically bullish month for Bitcoin – this digital asset is trading at $71,789, which is just 3% less than its March 2024 ATH of $73,737.

While the prospect of a recent ATH puts the cryptocurrency market on its feet, veteran analyst and trader Brandt believes that a number of conditions must be met to determine a confirmed breakout.

In post published in X October 29, Brandt cautioned BTC bulls against excessive enthusiasm without technical confirmation of the breakout.

In particular, the analyst warned bulls about the limitations of diagonal patterns – especially those with diagonal boundary lines – on trading charts.

Brandt explained that while a “crossing” of the boundary line may excite the bulls, it does not confirm a breakout.

For the breakout to be genuine, Brandt set a price target of $76,000, stating that Bitcoin’s daily chart must close above that level, with the average true range (ATR) measurement confirming this move above Bitcoin’s previous high set in March.

For the uninitiated, ATR is a technical analysis indicator that measures market volatility by calculating the average of the actual price ranges over a set period, usually 14 days. It reflects the degree of movement of an asset, helping investors assess potential price fluctuations and set more informed stop-loss or profit targets.

Moreover, Brandt notes that such a breakout must be confirmed by the close at midnight UTC on Sunday to ensure that it is not a false breakout that will end up trapping bullish investors.

On the weekly chart, Brandt highlighted that Bitcoin’s recent rise “only broke through important points on the chart” rather than breaking through with conviction.

The analyst concluded that the BTC price has a long journey ahead before it decisively forms a recent support level.

It is critical to break the resistance level of USD 71,000-73,000

Fellow cryptocurrency analyst, 0xAmberCT, highlighted the importance of a robust resistance zone around $71,000-73,000. However, the analyst gave several reasons why it may be different this time.

First, the high odds of victory for Republican US presidential candidate Donald Trump could provide much-needed fuel for the broader cryptocurrency market to launch a rally in Q4 2024.

At the time of writing Polymarket gives Trump has a 66.5% chance of winning compared to Democratic candidate Kamala Harris’s 33.5%. Trump’s victory is a positive development for the digital asset industry.

Additionally, recent interest rate cuts by the US Federal Reserve (Fed) and increased prospects for a supple landing are expected to boost market risk appetite. Risk-bearing assets like BTC are expected to benefit in a lower interest rate environment.

The analyst rating is in line with Matt Hougan, CIO of Bitwise forecast that BTC could “melt” to $80,000 in the fourth quarter of 2024.

However, recently cryptocurrency analyst Cole Garner common that BTC may decline before reaching the recent ATH due to tightening on-chain liquidity. At press time, BTC is trading at $71,789, up 4% in the last 24 hours.

Featured image from Unsplash, Charts from X and Tradingview.com