Bitcoin Shows Extreme Volatility After $10,600 Spike

The Bitcoin price has been showing a high level of volatility following its abrupt increase to $10,600 on Oct. 26, when Bitcoin climbed by 43% against the United States dollar on a single day.

The volatility of Bitcoin's marked increase following a six-month low indicates that investors remain divided on the potential short-term trend of Bitcoin.

Given the stability of Bitcoin subsequent to achieving $10,600 in late October, some technical analysts favor a bullish scenario in which the Bitcoin price avoids a re-entry into the mid-$8,000 support level and looks to break out above $10,000.

On Nov. 1, the highly anticipated monthly candle of Bitcoin is set to open at previous monthly candle openings, as the Bitcoin price has tended to record a large spike in value.

Josh Rager, cryptocurrency trader and technical analyst, similarly said that if the Bitcoin price is able to reclaim the mid-$9,000 region, it will likely lead the dominant cryptocurrency back above the $10,000 mark, an area considered as an important psychological level by investors, "Daily support below, while overhead is the weekly and monthly open with a break and close above these areas on higher time frames will likely be a signal to move up in the $10ks."

Scott Melker, a trader at Texas West Capital, described the current price action of Bitcoin as a largely bullish trend, based on its rebound from sub-$9,000, "This looks massively bullish to me. Price has broken out of the descending channel and is consolidating with the former resistance as support. Still long from $8.985.".

The daily trading volume of Bitcoin then dropped below $1 billion on Oct. 12, down substantially since June when Bitcoin price hit a yearly high at $13,920.

A technical analyst and trader known to the cryptocurrency community as "Dave the Wave" has long emphasized the bear trend of Bitcoin since mid-2019, ever since the asset started to fall off from its spike to $13,920.

If the Bitcoin price is following a fractal, the analyst said that a drop to the $6,000-$7,000 range is likely in the short to medium term, adding that BTC has fallen back into the downside trend after its rise to $10,600.

With Bitcoin showing a high level of volatility - which it normally does not demonstrate - and potentially large markets for the asset opening up to blockchain technology, macro factors could add to the upside movement of BTC if it breaks out upon its monthly open.