Bitcoin Struggles for Direction in September as Bulls and Bears Battle
Summary:
Bitcoin experiences a slow decline in September, lacking a clear trend as bulls and bears struggle. Large-volume investors remain cautious around the $26,000 level. The presence of trendlines helps limit volatility, while the 200-week moving average presents buying opportunities. The US dollar's strength poses a challenge, and supply and demand zones indicate a potential dip limited to above $25,000. Investors should exercise caution and conduct their own research before making any decisions.
Bitcoin (BTC) has experienced a slow decline in September, lacking a clear trend due to the absence of significant bull or bear movements. The current price performance of BTC/USD suggests the formation of typical September losses. Notably, large-volume investors are remaining cautious, as the $26,000 level has been a familiar point for Bitcoin this year.
The presence of multiple trendlines around the current spot price has helped to curb volatility. In August, Bitcoin lost support from the 200-week moving average (MA), causing a drop of over 10%. Analysts have highlighted the significance of the 200-week MA, which has historically acted as a bottoming out region during bear markets. The current price cycle, however, has shown some differences in terms of Bitcoin's interaction with the trendline. Despite flipping the 200-week MA into a new resistance level, this MA continues to offer buying opportunities for long-term BTC investors.
As of September 5, the 200-week MA stood at $27,680, approximately $2,000 above the spot price. The strength of the US dollar is also impacting crypto markets, with the US dollar index (DXY) experiencing an uptrend since mid-July. A stronger dollar typically has an inverse correlation with BTC price movements during periods of volatility. Traders are now observing whether the DXY will challenge a recent local high from late May. While expecting a potential impact on Bitcoin, some traders even foresee the possibility of filling the CME futures gap near $20,000.
Meanwhile, popular trader Skew is focused on supply and demand zones, noting that a potential dip may be limited to above $25,000. Skew emphasizes the importance of reclaiming a 12-hour range low at $26,200 for Bitcoin bulls to push the price higher; otherwise, the price may grind lower again towards the 12-hour demand level.
It is important to note that this article is for informational purposes only and does not provide investment advice. Readers should conduct their own research and exercise caution when making investment decisions.
Published At
9/5/2023 10:52:04 AM
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