The new Bitcoin price fell to $ 45,000, contrary to bullish forecasts as traders waited for a rebirth in October.Bitcoin started the week on a major downward move, but that hasn’t shaken investor confidence in the bull cycle.A complicated weekend resulted in Bitcoin closing at $ 47,000, only to lose all previous gains and question the $ 45,000 support a few hours later.It’s a delicate situation, not just Bitcoin, but the stocks and confidence hit by the bursting of the bubble of Chinese real estate giant Evergrande. What could affect the cryptocurrency market?With analysts anticipating a week of “change” for bitcoin price action, here are five factors worth considering when plotting where bitcoin could establish itself in the near term.
El Salvador “buys the dip”
Bitcoin’s action on the spot market hardly inspires traders at the beginning of a new week.
Bitcoin’s strength has reversed, losing the $ 46,000 mark.
Amid the turmoil in traditional markets led by Evergrande history in China, this week may not offer profitable deals. Now is the time for retailer Pentoshi to buy and wait for the situation to resolve on its own.
I am definitely long. I am bullish. Said it last week. I think this week is going to be loud. Much information is missing. I think we could go up to 41k but IMO we’re going to 56-58 so just chill out on the spot
– Pent ◎ shi doesn’t want you DM (@ Pentosh1) September 20, 2021
“I know this place very well. I am optimistic. Said it last week. I think this week is going to be loud. Much information is missing. I think they could go down to $ 41,000, but I think BTC will hit $ 56,000 to $ 58,000 so I get chills when I see that. “
As Cointelegraph reported, $ 44,000 represents a wall of support that Bitcoin is currently expected to retest. A deeper drop could be $ 41,000 or even $ 38,000, with the latter forming an important Fibonacci retracement level.
However, sentiment remains in favor of a bullish comeback in the crypto markets in the fourth quarter.
Meanwhile, among those who bought the dip was the El Salvador government, which tweeted this morning that they had bought another 150 BTC and increased their holdings to 700 BTC.
“They can never beat you if you buy the dip.”
Bitcoin 1 day frame price chart | Source: TradingView
Bitcoin behaves “like an absolute champion”
It’s a tough environment out there, and all in all, Bitcoin is doing much better than expected, analysts say.
Whether stocks or gold, the picture is sure to be less rosy this week. For example, the S&P 500 is well on its way to closing below its 50-day moving average (MA-50) for the first time since June.
Gold is moving towards its lowest level since April, while veteran trader Brandt noted against the Nasdaq 100 that it is almost at a 20-year low.
– Peter Brandt (@PeterLBrandt) September 18, 2021
“With the dollar rising (near the cycle high), stocks weakening, and gold falling, Bitcoin is behaving like an absolute champion because it rejects the concept of going into the low cycle. Relatively healthy, ”said trader, entrepreneur and investor Bob Lukas To write in a current situation summary.
The strength of the US dollar is indeed remarkable, with the US dollar index (DXY) approaching 94 in a classic headwind for Bitcoin.
When the status quo begins to change, the impetus for Bitcoin to perform better is clear.
US dollar index 1 day frame | Source: TradingView
Bitcoin is about to face the difficulty get a raise 5 times in a row
Bitcoin fundamentals have never looked better – a cliché maybe, but this week the numbers speak for themselves.
Both difficulty and hashrate strongly reject the downtrend and show that miners’ fundamental beliefs are still bullish.
Mining troubles, which dampened the impact of mining in China for months in May, rose for the fifth consecutive year on Tuesday.
This is a rare occurrence – the last time mining difficulty increased 5x in a row began in late 2019 before the March 2020 market crash clouded the mood. Even the subsequent bull, which hit an all-time high of $ 64,500, failed to repeat the feat.
Hence, for those who believe that price movement depends on the fundamentals of the network, the outlook is more optimistic than ever.
The hashrate confirms this – despite the average price development of the past week, estimates continue to assume 140 exahashes per second (EH / s) for the network, which is only 17% below the all-time high (ATH).
For the investor Vince Prince, a commentator for the regulator on hashrate performance, the recent contrast between the metric and the spot market prices gives cause for confidence.
“While the price of Bitcoin has fallen massively, the hash rate has actually increased,” wrote Vince Prince summary last week.
Average bitcoin hashrate for 7 days | Source: Blockchain
It “only increased”
Bitcoin’s actual limit is currently $ 21,000 above the 2017 ATH on the spot market. Its 200-week moving average (WMA-200), which is often viewed as the defining floor and a level that Bitcoin has never broken, currently stands at $ 15,600.
Bitcoin WMA-200 vs. Actual Limit vs. Bitcoin Chart | Source: PlanB
These aren’t just numbers, says analyst PlanB, creator of the Stock-to-Flow (S2F) Bitcoin model.
The relationship between the actual limit – an expression of market capitalization based on the price that each bitcoin last moved – and the WMA-200 is a useful measure of market growth potential.
Earlier price cycle peaks, particularly in late 2013 and 2017, were accompanied by a large gap between the two indices. However, this time the opposite is true and the odds for Bitcoin are definite buying power.
Not really, the realized cap was much higher compared to 200WMA at previous highs:
Peak 2013: 320/49 = 6.5
Top 2017: 5k / 1.4k = 3.6
today: 21k / 16k = 1.3 (so IMO we are fine, top is coming)
– PlanB (@ 100 trillion USD) September 19, 2021
“Not really, the realized limit is much higher than with WMA-200 at previous highs:
Peak 2013: 320/49 = 6.5
Top 2017: 5k / 1.4k = 3.6
Today: 21k / 16k = 1.3 (so okay in my opinion, the top hasn’t arrived yet) “.
As Cointelegraph reported, the estimate calls for a six-digit Bitcoin price by the end of the year. The fourth quarter should be the stepping stone, with October providing a solid foundation with a minimum monthly close of $ 63,000.
“October was $ 63,000, over 31% more than today”, confirms analyst PlanB.
Meanwhile, the “worst case” is $ 43,000 for the monthly closing price in September.
“Best Bear Market Ever”
Historically, it was a classic setup that ruled out major periods of bullish price movements – Bitcoin was relatively close to the ATH level, but nobody cared about that.
Although Bitcoin was trading at just under $ 50,000, Bitcoin has been a less and less interesting topic this month – a trend that is also evident among internet users.
Google Trends data for the Bitcoin keyword | Source: Google Trends
Only in December 2020 was the search volume relatively lower, which happened before the actual main phase of the Bitcoin bull run.
However, as analyst William Clemente suggests, such conditions are perfect for Bitcoin price action to cause an unexpected shock.
“Bitcoin broke out of a bull run last night and hit higher, funding was 0.01% and my feed was baffled. Great “. William Clemente was tweets on Sunday, who previously sarcastically described the current circumstances as “the best bear market ever”.
Crypto Fear & Greed Index as of September 19th | Source: alternative.me
Investor sentiment is also at an ideal level for the time being, with the Crypto Fear & Greed Index in the “neutral” area as Bitcoin reverses the last resistance before USD 50,000.
The figure shows that “extreme greed” in line with the speculative trade write-off at the beginning of September has not yet experienced a significant comeback on the crypto market.
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According to Cointelegraph