In recent days, negative forecasts have been circulating in the short term for Bitcoin, so much so that according to some, a new crash could occur today.
In fact, although the current situation does not seem particularly worrying, there are concerns regarding the holding of the bottom.
Today’s predictions on Bitcoin change after the recent crash
On February 27, 2024, the price of Bitcoin surpassed $57,000 for the first time after the last major crash.
Within about two weeks, continuing to rise, it recorded new all-time highs above 73,000$, but then a long period of lateralization began, which is still ongoing, more than six months later.
The first post-ath retracement occurred already in March, and brought the price of BTC to $60,000. In fact, however, after a brief pause, it continued until early May when it ended up bouncing at $56,500.
Since then, it has done nothing but oscillate between $57,000 and $72,000, with rare exceptions outside of this band. In particular, the $53,500 reached on July 5, and the $49,000 reached on August 5 should be mentioned.
In fact, excluding those two single and quick episodes, the 57,000$ have operated as a sort of bottom of this period of lateralization, even if they have not always held.
The key level of $57,000
In the last seven days, the price of Bitcoin has dropped from $64,500 last Monday to $57,100 last night.
So for now the bottom placed at $57,000 has held.
The problem is that there are short-term forecasts according to which it might not hold up again.
Given that, both one and two months ago, the price has already dropped significantly below this threshold, it would not be surprising at all if it did it again.
Moreover, at this moment the price is falling due to a reduction in buying pressure, in the face of a selling pressure that has dropped significantly in recent weeks and is now stable, and in the short term, there are no signs of a possible significant increase in buying pressure.
In the event that this time as well the 57,000$ does not hold, one can expect a new collapse similar to that of early July or early August.
The medium-term forecasts after today: Will Bitcoin continue the crash?
However, the discourse changes if the attention is shifted to the medium/short term.
For example, at the beginning of July it took less than 24 hours to get back above $57,000, after crashing to $53,500.
At the beginning of August, however, it took two days, but the collapse had pushed down to $49,000.
It is possible to imagine that this time the dynamic could be similar as well, should there be a new drop below 57,000$ soon.
It should not be forgotten that in about two weeks, on September 18, the Fed is expected to cut rates, and this could be a positive signal for Bitcoin.
Furthermore, throughout the entire year, from March until today, the BTC present on crypto exchanges have almost constantly decreased, making it evident that there has been an accumulation phase in place since then, consisting of purchases and withdrawals.
On the other hand, even though in recent days there have been net outflows of BTC from ETFs, the medium-term trend remains bullish, with over 17,000 Bitcoin purchased by the new US ETFs in just eight months.
The sentiment on Bitcoin (BTC)
The sentiment, however, remains negative.
The month of August ended with an overall decrease of 8.6% in the price of Bitcoin, and September started with a further decline.
Since the end of August, the Fear&Greed index has returned to negative territory, below 30 points, and in the last two days it has dropped to 26 points. After today’s session, it is possible that it will drop even lower.
At this moment, it is probably the negative sentiment of retail that is pushing the buying pressure down, because at the institutional level it is possible that the accumulation is simply continuing.
Among other things, September has often not been a particularly positive month for Bitcoin in the past, even though it is not so common for September to be an overall negative month after a negative August as well.
The opportunity to purchase
A couple of days ago, the CryptoQuant analyst, Grizzly, wrote that the current moment could be “an ideal opportunity for Dollar-Cost Averaging (DCA) strategies”.
It is important to remember that DCA is not a short-term speculator strategy, but an accumulation strategy for long-term holders.
It involves making many purchases over time, generally recurring and of small amounts, which effectively allow you to accumulate BTC over time without having to commit amounts beyond your means.
The reasoning of Grizzly is based on an index (Puell Multiple Index) that probably even some institutional investors know, and this strengthens the hypothesis that for institutional investors this could be a moment of accumulation.
To all this, it should finally be added that often October has been a positive month, and therefore it is possible that the speculators who are buying at this moment are doing so with the intention of selling in a month or a little more at higher prices.
Perhaps the turning point could be the Fed’s rate cut, or the preceding moment when the markets will start to price it in.