As we enter September, the crypto markets seem to be at a critical juncture with BTC price action potentially headed for a ‘double top’. The commencement of the month sees a divided crypto community with some traders debating about BTC‘s landing point, with bearish predictions as low as $23,000. The optimists, on the other hand, face the challenging task of reviving the market momentum.
BTC has managed to maintain a low profile in the out-of-hours weekend trading, causing some analysts to speculate whether this stability will persist. Interestingly, some have associated brief price dips with miners offloading their BTC onto exchanges. This action has introduced additional selling pressure and poses a potential threat to BTC’s stable performance.
On the other side, there’s a silver lining of promising data surfacing on the crypto landscape. The percentage of BTC supply held dormant for three years or more is at an all-time high of around 40%. BTC stock that has remained inactive for five years or more is nearly 30% – another record. This reduction in active supply is welcomed by bullish investors as future BTC demand will now compete for a smaller pool, thereby potentially leading to a price rise.
However, the public interest in Bitcoin seems to have taken a hit. Google Trends data reveals that normalized search interest for “Bitcoin” has reverted to levels seen before BTC broke its 2017 high of $20,000 in late 2020. Notably, the average crypto investor currently feels apprehensive as the Crypto Fear & Greed Index reflects “fear” as the dominant mood.
Adding to the ambiguity, Bitcoin’s sensitivity to Federal Reserve statements has notably decreased over the summer. On the macroeconomic front, the coming week holds no significant events, save for a few senior Fed officials offering commentary on the economy’s condition. Thus, the market seems relatively cool, providing a small respite for risk asset traders.
In summary, as we proceed into September, BTC‘s primary challenge appears to be balancing between the fears and hopes of its community. The dividing viewpoints within the crypto sphere and potential external influencers like Fed comments could dictate its future trajectory. Should miners persist on offloading their BTC, this downward pressure may push prices further into bearish territory. However, the slowly constricting supply could also trigger a rise in price as demand competes for less available supply. It’s a delicate situation, and only time will tell which direction BTC will take.
Source: Cointelegraph
