Bitcoin traders brace for sub $52K BTC price as crypto and macroeconomic headwinds intensify
2024.09.06 21:10
Bitcoin (BTC) price is trading 10% above the eight-month low of $49,577, reached on Aug. 5 and traders fear new lows under $52,000 could occur before a reversal takes place.
BTC/USD daily chart. Source: TradingView
On Sept. 6, Bitcoin extended the correction, dropping more than 5.9% from a high of 56,984 to reach an intra-day low of 53,613.
Drawing from this performance, analysts now believe that downside risks remain for Bitcoin, with the $52,000 level being a key area to watch at the moment.
“#Bitcoin pushing deeper toward the lows at $52,000,” popular trader Jelle wrote in a Sept. 6 post on X.
Jelle was responding to a sharp drop in Bitcoin’s price following the release of lower-than-expected US jobs data, which cast doubt on the health of the labor market.
According to the analyst, Bitcoin’s sell-off over the last few days saw it drop below key support levels including the psychological level at $58,000 embraced by the 200-day simple moving average.
The price is currently trading below this supply zone, and Jelle believes that bulls should aggressively defend the July 5 low of around $52,000 to prevent BTC from sinking deeper.
“Rektember out in full force.”BTC/USD chart. Source: Jelle
Meanwhile, fellow analyst Daan Crypto Trades presented two scenarios based on Fibonacci levels drawn from the Aug. 5 swing low at $49,577 to the local high at 65,103, reached on Aug. 25. The first one involved a Bitcoin price bouncing off the 61.8% Fibonacci retracement level at $54,604.
The second view involved a breakdown of the support at $54,000 to continue the downtrend. This could present a perfect entry position for longs at $52,400, embraced by the 78.6% retracement level.
BTC/USD daily chart. Source: Daan Crypto Trades
MN Consultancy founder Michael van de Poppe says Bitcoin price might dip toward the $53,000 to $54,000 support zone before making a “surge back upward.”
According to van de Poppe, for this to happen, Bitcoin price has to quickly reclaim the $56,000 level.
Source: Michael van de Poppe
Related: Crypto in ‘extreme fear’ as Arthur Hayes tips ‘sub $50K’ Bitcoin weekend
Bitcoin UTXOs in profit decline
Pseudonymous analyst Kyledoops shared a CryptoQuant chart showing that the percentage of Bitcoin’s Unspent transaction outputs (UTXOs) in profit has been decreasing since mid-July, suggesting profit-taking activity.
Bitcoin UTXOs refer to the amount of cryptocurrency that remains after transactions on the network. Analyzing the metric is crucial in understanding investor behavior over different periods.
“The percentage of Bitcoin UTXOs in profit has fallen to 68.5%, the lowest level since October 2023,” Kyledoops explained in a Sept. 6 post on X.
“This drop indicates selling pressure from traders taking profits.”Percentage of Bitcoin UTXOs in profit. Source: CryptoQuant
Generally, reducing Bitcoin UTXOs in profit gives room for BTC to rally as seller exhaustion sets in.
The last time the UTXOs in profit reached such levels was in January 2023, preceding Bitcoin’s price rally to a new all-time high, rising 273% from $26,700 to $73,000.
“Historically, such declines have preceded significant price surges; Bitcoin’s price previously rose 273% after a similar decrease.”This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
