Confirmation of bearish pennant breakdown?5 things to watch for Bitcoin this week


Bitcoin (Bitcoin) Start a new week in an unstable place-below $45,000 and below some key moving averages. What’s the next step?

Nearly a week after a series of leveraged positions were closed forcing the market to rise to $42,800, Bitcoin has erased much of its subsequent recovery.

There was almost no paradigm shift over the weekend, and now, downward volatility has firmly existed. As BTC/USD fell by 13% in a week, Cointelegraph studied five things that might help traders predict the next move.

Stocks about to rebound

After the selling pressure in the first half of September exacerbated Bitcoin’s woes, the stock market is expected to perform better this week.

After the red week in the past week, people expect the stock market to rebound now, continuing the characteristic trend of the market since the coronavirus crash in March 2020.

“Expect the stock market to rebound this week and provide some relief for Bitcoin,” said Charles Edwards, CEO of Investment Manager Capriole, forecast.

In the past year, the overall relationship between Bitcoin and macro trends has been increasingly questioned. Nevertheless, the shock to the system continues to affect the price trend of BTC, as evidenced by the Fed’s Jackson Hole Virtual Summit in early September.

“The world still sees Bitcoin as an asset risk,” Edwards Add to In the comments next to the comparison chart.

“Almost every Bitcoin correction in 2021 is related to a S&P 500 correction of -2% or more.”

BTC/USD vs. S&P 500 annotated chart.Source: Charles Edwards/Twitter

On the other hand, strong stocks may help curb the strength of the dollar, which also gives Bitcoin more breathing room.

Last week, the US Dollar Currency Index (DXY) quickly moved towards 93 and then stopped consolidating its gains. This process continues.

Spot prices are further below bullish indicators

The forecast believes that in terms of BTC price trajectory this week, the macro trend may become a deal breaker.

After the weekend consolidation, there was a last-minute volatility on Sunday, and finally BTC/USD fell below 45,000 US dollars.

With spot traders Hedge their bets Even worse, it can be said that there has never been such a big difference between on-chain indicators, adoption phenomena and prices.

“The liquidity of stablecoins increased, Bitcoin on the exchange fell to a 3-year low, and the norms awakened,” Lex Moskovski, CEO of Moskovskiy Capital Summarize.

“If Macro doesn’t pee on the bed, then the next step is programmed.”

Moskovski later added that the macro market was indeed green at the beginning of the week, and stablecoins were not used as collateral for shorting, making a clear bullish argument.

As reported by Cointelegraph, current estimates treat $43,000 and $38,000 as potential price floors and rebound from these levels Still possible Although much lower than Important moving average.

September is historic Underperforming month For Bitcoin, therefore, the price forecast is conducive to the “real” upside that will restart from October.

“Remember, Bitcoin is a red month in September, and prices will fluctuate sharply in the fourth quarter,” the popular Twitter account Lark Davis Tell followers on Monday.

“By the end of the year, BTC can still reach 100,000.”

BTC/USD 1-hour candlestick chart (Bitstamp). Source: TradingView

Still, veteran trader Peter Brandt is ringing the alarm-at least for now.

“This chart pattern has a name. Does anyone want to guess what it is called?” He Tweet Together with the daily chart, it appears to be a breakdown of the bearish pennant structure.

“Dancing with Us 2017”

It’s not all doom and pessimism-when it comes to this halving cycle, in terms of price increases, this year’s Bitcoin is still “dancing with 2017.”

That is based on data From the trading platform Decentrader, the platform indicated this week that after the halving of major subsidies, BTC/USD in 2021 will still be on the right track.

“Dancing with 2017 Now”, Decentrader Analyst Filbfilb Said In the comments over the weekend.

Bitcoin bull market comparison chart. Source: Decentrader

This chart shows the extent of the miners’ defeat in May. Bitcoin once rose between 2013 and 2017, then fell in May to form a new lower paradigm, and this trend is finally continuing.

As Cointelegraph ReportThe “double top” phenomenon is still an analyst’s bet on how Bitcoin will end in 2021—just as it did in 2013 and 2017—the price drop during this period is related to the $29,000 trip in May.

Monthly illiquid supply hit a record high

One feature that made the price drop environment last week different from the past is the behavior of investors—everyone continues to buy.

Unlike the panic in March 2020 and other periods, last week saw speculators dumped into the market by the surplus supply that strong players eagerly bought.

According to statistician Willy Woo, every type of Bitcoin investor either increased their positions or remained neutral in the recent turmoil.

“Whales have recently increased. Small fish continue to stack. 10-1000 BTC holders are basically the same,” he disclose Sunday and data from the on-chain analytics company Glassnode.

“The number of publicly held reserves has decreased (mainly because exchanges and ETFs have decreased and companies have increased).”

Distribution map of Bitcoin supply. Source: Willie Wu.Twitter

If there is more supply of Bitcoin than ever before, similar data proves this. As analyst William Clement pointed out, last week there was little impact on the coin holder model.

“For at least one month, 93% of the Bitcoin supply has not changed. This is a record high. It’s just another indicator showing how optimistic the supply dynamics are,” he Comment, Quoting Glassnode data.

Bitcoin HODL wave annotated chart.Source: William Clement/Twitter

Where was once greedy now comes fear…

Investor sentiment indicators have all changed Crypto Fear and Greed Index, Released some strange data on market sentiment this week.

related: Top 5 cryptocurrencies worth watching this week: BTC, ALGO, ATOM, XTZ, EGLD

The drop to $42,800 slashed its reading from “extreme greed” to “fear”, an emotional zone that lasted until Sunday.

However, as the weekend ended, the index added some new “greed”-although price movements actually fell further.

At the time of writing this article on Monday, fear and greed are 44/100—still in the “fear” zone—and BTC/USD is trading at less than $45,000.

Crypto fear and Geed index. Source: Alternative.me

The cross-exchange financing rate is Slightly positiveHowever, do not underestimate the possibility of “short squeeze” to improve price performance.