Bitcoin (BTC) suffers a severe price slump after a bullish previous week. Within one day, the price increase of an entire month was pulverized.
Bitcoin (BTC): Consolidation or next price jump?
: 45,846 USD (previous week: 50,022 USD)
Resistances/targets: 47,070 USD, 48,222 USD, 50,325 USD, 51,307 USD, 53,005 USD, 54,077 USD, 55,817 USD, 57,998 USD, 59,470 USD, 61,771 USD, 64,896 USD, 67,416 USD, 69,660 USD, 70,856 USD, 76,472 USD, 77,678
Supports: 46.009 USD, 44,878 USD, 44,147 USD, 42,923 USD, 41,321 USD, 40,585 USD, 39,240 USD, 38,537 USD, 37,321 USD, 36,643 USD, 34,899 USD, 33,335 USD, 32.718 USD, 31,603 USD, 31,010 USD, 30,000 USD, 29,300 USD, 28,795 USD, 27,563 USD, 26,404 USD, 23,887 USD, 22,222 USD, 21,892 USD, 19,884
After the Bitcoin price
initially able to rise to the lower edge of the orange resistance area at USD 53,005 on the morning of Tuesday, September 7, a significant sell-off of the cryptocurrency followed in the early afternoon. At its peak, the BTC price fell back by more than 21 percentage points to the support at USD 42,923. This also caused an interim bloodbath in the overall market. One of the causes of the crash, in addition to the significant long overhang in the futures market for leveraged Bitcoin products, is the bumpy start of Bitcoin as a means of payment in El Salvador
. When the Chivo wallet was launched, the system crashed due to high demand. Currently, the Bitcoin price is able to recover, but is now trading below the green resistance zone between USD 47,070 and USD 48,222 again at USD 45,846.
Bullish scenario (Bitcoin price)
The significant price correction could be stopped by the bulls at 42,923 USD, but the sell-off still pulverized the rise of an entire month. This sell-off shows once again that one should never be too safe in the crypto market. Out of nowhere, the price plummeted by more than 21 percent and caused crocodile tears, especially among investors in the derivatives market. In total, leveraged long products worth around USD 4 billion were liquidated. Even harder hit were the large
The majority of altcoins, which have lost 40 or more percentage points in value in the meantime.
Although the BTC price was able to recover by more than eight percentage points in the last trading hours to currently 45,846 USD, Bitcoin now has to overcome strong resistance levels again. Only if the bulls can move the cryptocurrency back above USD 47,070 and especially the EMA20 (red) at USD 48,222 on the daily closing price, the resistance zone between USD 50,325 and USD 51,307 will come back into view. If the blue resistance zone can be overcome again, another directional decision will be made at USD 53,005.
The path towards an all-time high
Above this resistance level, there would initially be room to reach USD 54,077, which would also brighten the chart picture considerably. If the USD 54,077 level is also overcome on the daily closing price, a subsequent rise to the next price target at USD 55,817 can be planned. This chart level has been increasingly contested in the past. If Bitcoin does not show any renewed signs of weakness here either and breaks through USD 55,817, the higher price target at USD 57,998 will be activated. The first profit-taking is likely to set in again here. Only if Bitcoin can also sustainably overcome this resistance level will investors focus on the old high at 59,470 USD.
If a breakout above this price level is successful, a rise to USD 61,771 is initially conceivable. In the medium term, a rise to the all-time high of 64,896 US dollars should also be envisaged. If the bulls subsequently manage to break through the all-time high, the 138 Fibonacci extension at USD 67,416 comes into view as a target. Stabilization above USD 60,000 should take Bitcoin towards the next target area between USD 69,660 and USD 70,856. If there is no significant price setback here either, the cryptocurrency could target the maximum derivable target range between USD 76,472 and USD 77,678.
Bearish scenario (Bitcoin price)
The bears came back to the floor with a bang. The sell-off by some large investors led to a chain reaction in the derivatives market and caused the price to break away noticeably. If the sellers’ camp manages to cap the BTC price below the resistance area between USD 47,070 and USD 48,222 in the coming trading days, the area around USD 46,009 will come back into view. This is where the MA200 (green) and the super-trend are found. A daily close below USD46,009 makes a retest of the support at USD44,147 likely.
The EMA50 (orange) and the lower Bollinger band are currently located here. If this support level is sustainably abandoned, a renewed decline to at least 42,923 USD threatens. If the bulls do not get back into the market here, a correction extension into the green support zone between USD 41,334 and USD 40,585 is to be planned. This is also where the EMA200 (blue) currently runs. If the bitcoin price also breaks through this strong support, a decline to at least 39,240 USD is conceivable. A direct sell-off to 38,537 USD is also not out of the question.
Below 38,537 USD, the correction gains momentum
If this support is also abandoned on the daily closing price, the downward momentum will gain additional momentum. A fall back to
the 23 Fibonacci retracement at 37,321 should be taken into account. Should this support also be abandoned without resistance from the bulls, the correction will extend to USD 36,643. Continued weakness activates further bearish price targets at USD 34,899 and USD 33,355. Here, the 61 Fibonacci retracement is found, which represents a strong support. Should this support also be abandoned on a sustained basis, a fall back to USD 31,603 is likely.
If the bitcoin price also breaks through this support, the downward movement will extend towards the maximum bearish target range between USD 31,010 and USD 30,000. For now, this progression low in the purple support area represents the maximum price target on the downside. As long as the low of June 22 at USD 28,795 is not abandoned, price targets at USD 26,399 or below are illusory for the time being. Again this week, as long as bitcoin stabilizes above USD 42,923, the bulls continue to have the advantage for now.
Bitcoin dominance: bounce off downtrend line
Bitcoin dominance fell as expected to the horizontal support at 41.22 percentage points, but was able to defend this support several times as of the daily close. Due to the sharp drop in the prices of all cryptocurrencies yesterday, Tuesday, September 7, there was a significant price swing to the north. At its peak, BTC dominance touched the lower edge of the red box at 43.68 percent before falling back to 41.91 percent once again. Currently, the cryptocurrency’s dominance is trading at 41.83 percent, just not far from the resistance level at 42.27 percent. It should be noted that the support level at 41.22 percent has held for the time being, keeping the BTC dominance at the previous week’s level. However, until bitcoin dominance can generate stabilization above the EMA20 (red), there is still potential for a retracement.
BTC dominance: bullish scenario
Yesterday’s sell-off in the entire crypto market ensured that some investors switched out of the altcoins back into Bitcoin. This had a positive effect on its market dominance in an initial reaction. If BTC dominance manages to close above 42.27 percent as of the day’s close, a follow-through rise to the 43.05 percent area is likely. This is where the first relevant cross resistance is found, consisting of the horizontal resistance line and the EMA20.
If this zone can also be sustainably recaptured and the red downward trend line can be overcome, a rise back to yesterday’s daily high at 43.68 percent can be planned. A subsequent rise back into the red box activates the next price-target at 44.54%. In addition to the EMA50 (orange), the super-trend also runs in this area. Since August 19, bitcoin dominance failed to recapture this chart level per daily closing price.
The path towards the psychological 50 percent mark
If a breakout above this resistance level occurs, the upper edge of the red box at 45.10 percent comes into view. If a breakout above this price level succeeds, resistances at 45.71 percent and 46.33 percent come into view again. This is where the upper Bollinger band is currently located. If the BTC dominance can stabilize above 46.33 percent without significant setbacks, a subsequent rise to 47.03 percent and 47.59 percent is conceivable. At the 47.59 percent level at the latest, a renewed retracement is to be planned. If, on the other hand, the BTC dominance succeeds in overcoming this strong resist, a march through to the orange resistance zone is conceivable.
In particular, the 48.67 percent is of important significance. A breakout above the 48.67 percent will bring the trend high from July 2021 at 49.26 percentage points into focus. Currently, the EMA200 (blue) is located here as well as the MA200 (green) not far above it. Once again, a setback is to be expected. Only when these moving average lines can also be sustainably overcome should Bitcoin’s market power increase once again and take off back above the 50 percent mark in the direction of 50.97 percent.
BTC dominance: Bearish scenario
BTC dominance failed to break the support at 41.22 percent as per daily closing price for four consecutive days. However, as long as Bitcoin’s market share fails to stabilize back above the 43.05 percent, the chance of a 41.22 percent consistency test again continues to prevail. If Bitcoin’s market power falls back below the 41.22 percent and also gives up the previous week’s low at 40.66 percent, a corrective extension to the 40 percent level is likely. If Bitcoin’s dominance does not turn sharply back north here, the low for the year at 39.66 percent will come into investors’ focus. If there is then a sustained break of this support, a correction extension into the green support zone between 39.21 percent and 37.67 percent is to be planned. Should the 37.67 percentage points also be abandoned in the coming weeks, a correction towards the psychologically important 30 percent mark is even conceivable by the end of the year.
Disclaimer: The price estimates presented on this page do not represent buy or sell recommendations. They are merely the analyst’s assessment.
The chart images were created with the help of TradingView to create the charts.
USD/EUR rate at the editorial deadline: 0.84 euros.