During the month of August, Bitcoin lost 8.6% of its value. It reached its lowest level at the beginning of September. This fall occurs in a market context weakened by reduced liquidity and exacerbated selling pressure. Investors and traders, accustomed to the roller coaster of prices, are looking for clues on the direction that the market could take in the days to come.
Bitcoin’s Sudden Drop: The Immediate Triggers
Over the last weekend of August, Bitcoin experienced significant selling pressure, with its price dropping by more than 2% on August 1.er September. The drop, dubbed an “after-hours monthly close,” sent the crypto to lows of $57,230, its lowest level since Aug. 16. Less liquid market conditions contributed to this difficult end of the monthIndeed, buyers were unable to support prices in the face of a wave of massive sales given the low trading volumes.
September is traditionally a difficult month for Bitcoin, with losses averaging 4.5% according to CoinGlass data. This bearish trend has been exacerbated by the activity of traders in the futures market, where “aggressive shorting” has been particularly noticeable during local dips. The outlook for support levels is pessimistic, with expectations of a drop to $51,000 if selling pressure continues. To avoid a further drop, Bitcoin must absolutely close the week above $58,450 in order to consolidate its support. Without this consolidation, the risks of a fall are high. This is not the case currently, as Bitcoin is at $54,456.04 this Sunday, September 8, 2024.
Traders on alert: what strategies for an uncertain market?
In the face of this volatility, many traders are opting for cautious strategies. They anticipate “liquidity grabs” to the upside as well as the downside. They warn that sharp swings could occur in both directions over the next week. From a trading perspective, they favor long positions, but they prefer to see an initial descent to liquidations and fill the wick at $56,600. This approach is based on the strategy that the market could first decline, attracting short sellers, before rebounding to higher resistance levels, such as $61,300, which have been identified as potential targets for a bullish recovery.
At the same time, some analysts believe that a stabilization above the current critical thresholds could signal a short-term recovery. However, the risk of a further decline remains high, especially if market conditions continue to deteriorate.
Bitcoin is starting September in the red. Thus, the short-term outlook is marked by uncertainty and caution. Traders should therefore scrutinize technical indicators and support levels to guide their decisions. They should be aware of potential risks. We hope that the September storm will not be fatal for them.
Maximize your Tremplin.io experience with our 'Read to Earn' program! For every article you read, earn points and access exclusive rewards. Sign up now and start earning benefits.
