As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous market cycles and learned that even the most bearish phases can be followed by unexpected bull runs. The current sideways trend in the crypto markets seems to be no exception.
Currently, the cryptocurrency market is experiencing a period of reduced volatility, where the price of Bitcoin (BTC) remains relatively steady. However, this situation may not last much longer, possibly within the next week or two, leading to a potential resurgence for both BTC and other altcoins.
Why is Bitcoin Price Down?
There are four reasons for the recent descent in Bitcoin price:
- Recession fears triggered by uncertain macroeconomic conditions.
Geopolitical tensions due to the war between Palestine and Israel.
The US Government selling BTC.
A drop in Donald Trump’s odds against Kamala Harris in the 2024 presidential elections.
By August 19, the price of Bitcoin had dropped by 1.62% and is now being traded at approximately $58,355. It’s possible that investors will witness a recovery in the crypto market as Bitcoin trades above the lower boundary of its Value Area Low (VAL) from the previous week, which was $57,958. Additionally, Bitcoin might reach the Point of Control (POC) from the previous week, currently set at around $59,384.
Initially appearing gloomy at the start of the week, Bitcoin’s value could potentially surge by almost 2%, reaching approximately $59,600 and possibly forming a temporary peak. If conditions remain favorable, Bitcoin may even challenge the $60,000 mark, a psychologically significant level.
In simpler terms, Matrixport, a company specializing in cryptocurrency services, has shared their perspective on Bitcoin’s potential future price movement. They predict a possible recovery within the upcoming weeks, which they attribute to the relationship between Bitcoin funding rates and cryptocurrency trading volumes in South Korea.
Matrixport pointed out that Korean traders significantly impact the cryptocurrency market. They predict that the funding rate might plummet further, given that Korean trading volumes have dropped below $1 billion for three straight days.
As an analyst, I’d like to highlight a significant point brought up by Matrixport – the upcoming Korean Blockchain Week, taking place during the first week of September, could potentially stimulate the cryptocurrency market recovery and boost trading activities.
Crypto Market Prepares To Buy The Dip
Based on information from Santiment, a significant surge in stablecoin deposits occurred on August 5th, coinciding with the drop in Bitcoin’s value to $48,914. This increase suggests that investors may be gearing up to take advantage of price drops, indicative of their intent to buy at lower prices.
In addition, the amount of Tether (USDT) on exchanges has risen significantly over the past week, from 15.68 billion to 16.72 billion. This 6.63% increase suggests that investors may be preparing to buy Bitcoin and other altcoins if the crypto market experiences a further drop.
In summary, investors might anticipate a significant resurgence in Bitcoin’s price over the near future, which could likely pull other digital currencies along for the ride.
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2024-08-19 15:52