Bitcoin’s Fourth Quarter Outlook: Will BTC Drop Below $50K or Surge to $70K?
Over the past few months, two primary narratives have dominated discussions surrounding Bitcoin [BTC]. One scenario suggests a significant uptrend, while the other raises concerns about a potential drop in price below $50,000.
These two possibilities have created opportunities for large investors and institutional players to leverage the emotionally driven price fluctuations, a trend observed consistently over the past five months. Bitcoin experienced a dip below $50,000 during a substantial sell-off event in August.
Following this sell-off, there was a quick rebound as traders rushed in to buy at discounted prices. In the recent downward pressure episode, bears struggled to push the price below $52,000, indicating resilient buyer interest in that range.
Analysis from Glassnode revealed a resurgence in accumulation, as the number of addresses holding zero balances approached 53 million, showing a recovery from the August lows.
However, this figure still lags behind the levels seen at the beginning of July, signaling lingering market uncertainties. Additionally, Bitcoin’s exchange reserves continued to decline, indicating a reduction in available coins on trading platforms compared to a slight increase seen at the start of September.
The Alternate Bitcoin Scenario
Whales, on the other hand, have displayed less activity in September compared to the period from June to August, with whale inflows slowing down in recent weeks.
The decreased whale activity coincided with diminishing demand for Bitcoin ETFs, evident from significant outflows. This trend aligns with the observation of Bitcoin forming lower highs in the past five months, reflecting decreasing bullish confidence.
Essentially, there remains a substantial risk of Bitcoin sliding towards $50,000 or lower. However, many sidelined whales may seize the opportunity to accumulate at discounted prices. Some traders are likely awaiting clearer market signals from the FED next week before making significant moves.