Despite the prevailing market trends, Bitcoin managed to record a positive performance in September. However, the digital currency experienced a notable decline over the last couple of days. At the time of writing, Bitcoin was being traded at $61,407, indicating a 4.31% decrease on a weekly basis.
Previously, BTC had been moving upwards, registering a 5.99% increase on a monthly scale. Nevertheless, after reaching a peak of $66,508, the price descended to as low as $60,164.
This recent price shift has triggered extensive discussions within the cryptocurrency community. Notably, esteemed crypto analyst Man of Bitcoin hinted at a potential downturn, referring to an ABC pattern within Elliot’s wave -B.
Evaluating the Analysis Findings
According to the analyst’s assessment, BTC has breached a minor support level, possibly leading to further decrease in value.
As per the analysis, the market sentiment is bearish, suggesting two plausible scenarios.
In the first scenario, Bitcoin is expected to undergo an ABC correction, with Wave-A already in progress, resulting in dropping prices. Notably, Wave-B is predicted to fail in propelling the price beyond previous highs. Consequently, in this situation, it is crucial for BTC to maintain its support above $55,355.
Alternatively, in the second scenario, Bitcoin might break below the critical $55,355 support threshold, initiating a downward five-wave pattern that signifies a more substantial decline.
The insights put forth by Man of Bitcoin propose a potential downside in response to the recent market movements. However, it is imperative to consider the other fundamental aspects influencing Bitcoin’s performance.
For starters, Bitcoin’s Price DAA divergence has exhibited negative trends in the past week, indicating that the ongoing rally in BTC’s price lacks adequate fundamental backing, as on-chain activities have receded.
Such conditions signify a potential unsustainability in price growth, suggesting waning interest and confidence in the market.
Moreover, the MVRV long/short difference has decreased from 4.5% to 3.7% over the recent week, indicating that long-term holders are reducing their positions, while short-term holders might be opting to sell to mitigate losses.
Lastly, Bitcoin’s netflow amongst large holders has transitioned into negativity post September 25th. This shift indicates that significant holders are not engaging in new positions, but rather closing existing ones.
The decreased inflow from dominant holders reflects a negative mood in the market, with high outflow suggesting profit-taking or risk aversion.
In summary, Bitcoin is confronting adverse market sentiments, with bearish tendencies striving for dominance. Should the current conditions persist, BTC is likely to dip to $59,899; in contrast, a reversal could propel Bitcoin back to the $62,675 levels.