Rainbow Chart Predicts $1.36 Million Bitcoin Price by October 31

The Rainbow Chart, a long-term valuation model, suggests that Bitcoin's price remains below its historical trend valuation as October begins. The chart's October 31 valuation bands sit well above Bitcoin's current price, with the highest valuation zone at $1.36 million, a band historically associated with extreme market euphoria and cycle tops. However, the indicator is designed to gauge long-term valuation rather than forecast where BTC will trade by month-end.

Bitcoin's current price is around $85,000, below the chart's lowest valuation band, highlighting the discrepancy between current market prices and the model's long-term trajectory. The Rainbow Chart's bands show that Bitcoin is currently in the 'Still cheap' zone at $287,747, suggesting undervaluation relative to its long-term trend.

While the Rainbow Chart mostly focuses on long-term valuation, Bitcoin's recent rally toward $87,000 stalled in the short term after whales reportedly took profits on more than 30,000 BTC. The $87,000 region coincided with the upper boundary of a trading channel that has capped prices for more than two weeks.