Bitcoin has reached a tipping point after several days of recovery and consolidation. On August 5, it saw a sharp capitulation, with the price falling to a monthly low of $49,577. While some investors remain skeptical, believing that Bitcoin has not yet hit its bottom, key data from CryptoQuant suggests that the worst may be over.
The broader market is now focused on the upcoming Federal Reserve interest rate decision, which could have a significant impact on the price trajectory of Bitcoin. Investors are waiting with caution to see if this week’s announcement will bring more certainty to the market. A positive decision could act as a catalyst for Bitcoin’s bullish move, pushing it past resistance levels.
However, the risk of further declines remains if Bitcoin fails to reclaim higher price levels in the near term. A break above the key resistance level at around $60,000 will be crucial to regain the upward momentum.
Bitcoin’s downtrend is coming to an end
Bitcoin is currently trading just under $60,000, reflecting a period of recovery from recent local lows. This positive price action has sparked optimism among investors, who are beginning to believe that the prolonged series of corrections that began in March may be coming to an end.
Analysts, including top experts, have suggested that the bottom was likely reached on August 5, marking a potential turning point for Bitcoin. Axel Adler, a senior analyst at CryptoQuant, specializes in on-chain research and macroeconomics, shared, Useful information about X Which suggests that Bitcoin may have already hit bottom.
The analyst’s chart reveals a significant drop in the Meyer multiple, from 1.82 at $73,000 to 0.9 points. A further drop to 0.7 points would confirm a local bottom. This indicator has historically been used to identify market bottoms and potential reversal points.
The recent price action has been characterized by an atmosphere of fear and uncertainty, but that sentiment is beginning to change. On September 15, the Fear and Greed Index showed a neutral level for the first time since August 26, indicating a possible stabilization in market sentiment.
With Bitcoin trading near $60,000 and showing signs of recovery, the market has started to adjust its outlook, suggesting that the worst of the corrections may be behind us and a new phase of growth could be on the horizon.
BTC Technical Levels to Watch
Bitcoin (BTC) is currently trading at $59,003 after a slight 5% decline from its local high last Friday. The price is facing resistance as it struggled to close above the 4-hour exponential moving average (EMA) at $58,848, testing this level from below. This EMA is a key indicator of short-term market strength, and reclaiming it will be essential for Bitcoin to regain momentum.
For bulls to challenge the current market structure, Bitcoin must break the $60,000 level, a psychological level that could trigger significant buying pressure if breached with conviction. A strong move above this level would signal a renewed uptrend, encouraging more investors to enter the market.
However, if Bitcoin fails to close above the 200 EMA 4-hours, a deeper correction could follow. The price is likely to target $55,500, a key demand level where buyers could step in to find support. This level is crucial as it could lead to a change in structure, which will determine the long-term direction of Bitcoin’s price.
Featured image by Dall-E, chart by TradingView
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