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(Kitco News) - Cryptocurrency prices trended higher on Monday as last week’s gains for Bitcoin (BTC) emboldened traders to re-enter the altcoin market ahead of what some analysts have said will be the largest bull market in the history of crypto.

Stocks reversed course from last week’s declines to post gains to start the week ahead of a highly anticipated Fed meeting where the central bank will announce its decision on interest rates. Analysts are expecting the Fed to hold rates at their current level at the Wednesday meeting as part of their “higher for longer” stance moving forward.

At the close of markets, the S&P, Dow, and Nasdaq all finished well in the green, up 1.20%, 1.58%, and 1.16%, respectively.

Data provided by TradingView shows that Bitcoin’s price traded in a range between $34,085 and $34,872 on Monday, with the bulls and bears matched evenly for strength.

BTC/USD Chart by TradingView

“October Bitcoin futures prices [were] a bit weaker in early U.S. trading Monday,” according to Kitco senior technical analyst Jim Wyckoff, who noted that “Recent price action has formed a bullish pennant pattern on the daily bar chart.”

Bitcoin futures 1-day chart. Source: Kitco

“The BTC bulls have the solid near-term technical advantage as a price uptrend is in place on the daily bar chart,” Wyckoff said. “Technical odds favor an upside price ‘breakout’ from the pennant pattern and probably this week.”

Bitcoin to hit $45,000 by year-end

According to David Lifchitz, managing partner and chief investment officer at ExoAlpha, “The month of October has so far lived up to its reputation of ‘Uptober,’ having gained for now close to 25% at the time of writing, which is in line with the historical October average. But now the question is: what is in the cards till year end?”

Lifchitz said that from a historical and statistical point of view, strong performances in October have previously carried through the year-end, but warned that “nothing here guarantees that history will repeat.”

Bitcoin monthly return. Source: Bitcoinmonthlyreturn.com

On the list of bullish factors for Bitcoin, Lifchitz highlighted the “SEC taking a less aggressive stand on cryptos; the approval of a spot BTC ETF around the corner; an approaching resolution in the FTX/Sam Bankman-Fried case; and ‘positive technicals.’”

The list of bearish factors include “Short-term profit taking after the recent run-up; Regulatory pressure on Binance, the world’s largest crypto exchange; the Mt. Gox liquidation repayment scheduled for early 2024; and the unraveling of the worldwide economy,” Lifchitz said.

Wildcards that could potentially affect the market include “Central Bank’s stance on rates; the Middle East situation potentially turning into WWIII; and the ‘revenge of the altcoins,’” he said.

“Overall, it looks like Bitcoin has more tailwinds than headwinds,” Lifchitz said. “It may take a breather in the short term after its torrid 6 weeks run, but that would even be positive to sustain the next leg up. Indeed, the longer the move up without any breather and the more parabolic it becomes, the higher the probability of a brutal unwind.”

Lifchitz gave a year-end price point of $45,000 as an “optimistic target” for BTC, noting that this would “represent a +170% growth for the year from the $16.5k level it was trading at in early January.”

He said $45,000 has a “significant amount of resistance,” while “a lot of the bullish factors have already been priced-in with the last 4 weeks upward move.”

“The only factor that has the potential to push Bitcoin up much more is the effective birth of a Bitcoin ETF, which could drain money from new investors in the system, but these new investors may not come immediately,” he said.

As for altcoins, Lifchitz noted that the CCI30 index, “which is a passive index of the top 30 coins by market cap’ regularly rebalanced, has been lagging behind the leader so far this year, and a catch-up rally may occur in them while Bitcoin takes a breather.”

CCI30 index. Source: CCI30

“Moreover, if Bitcoin decouples even more from its Alts cousins, that may weaken it as Bitcoin-Alts divergence never lasts for very long,” he said. “So maybe Bitcoin has a ‘trick’ for us in its bag for Halloween, but a ‘treat’ is likely afterward. History will tell!”

Traders rotate into altcoins

A majority of tokens in the top 200 recorded gains on Monday as traders looked to rotate into promising altcoin projects.

Daily cryptocurrency market performance. Source: Coin360

Polymesh (POLYX) led the gainers with an increase of 41.85%, followed by gains of 17.8% for Tellor (TRB) and 16.8% for Osmosis (OSMO). Gala (GALA) was the biggest loser with a decline of 4.5%, while Galxe (GAL) declined 4.2%, and Render (RNDR) fell 3.88%.

The overall cryptocurrency market cap now stands at $1.27 trillion, and Bitcoin’s dominance rate is 52.8%.