Bitcoin (BTC) prices are trading 10% above the eight-month low of $49,577 hit on Aug. 5, as traders worry that the cryptocurrency may hit new lows below $52,000 before reversing.
BTC/USD daily chart. Source: Trading View
On September 6, Bitcoin extended its correction, falling more than 5.9% from a record high of 56,984 to hit an intraday low of 53,613.
Given this performance, analysts believe that downside risk remains for Bitcoin, with the $52,000 level being a key area to watch at present.
“#Bitcoin is falling further towards a low of $52,000,” said popular trader Jeremy. Written In a post by X on September 6th.
Jere was reacting to the sharp drop in Bitcoin prices following the release of US employment data, which was weaker than expected and raised questions about the health of the labor market.
Analysts said Bitcoin has sold off in recent days, dropping below key support levels including the psychological level of $58,000, surrounded by the 200-day simple moving average.
With prices currently trading below this supply zone, Jelle believes bulls should aggressively defend the July 5 lows of around $52,000 to prevent BTC from falling further.
“The rectember is starting in earnest.” BTC/USD chart. Source: Jelle
Meanwhile, fellow analyst at Daan Crypto Trade Presented Two scenarios based on the Fib levels from the swing low of $49,577 on August 5 to the local high of $65,103 reached on August 25. In the first scenario, Bitcoin price bounces off the 61.8% Fib retracement level of $54,604.
The second view is that the downtrend will continue if the price breaks below the $54,000 support, which could provide a perfect entry position for going long at $52,400, supported by the 78.6% retracement level.
BTC/USD daily chart. Source: Daan Cryptocurrency Exchange
Michael van de Poppe, founder of MN Consultancy, said Bitcoin price could fall towards the $53,000 to $54,000 support zone before “reversing the upside.”
For this to happen, van de Poppe said, the price of Bitcoin would need to quickly reclaim the $56,000 level.
sauce: Michael van de Poppe
Related: Arthur Hayes predicts Bitcoin price will fall “under $50,000” this weekend, calling crypto a “super scary thing”
Bitcoin UTXO profits fall
Anonymous analyst Kyledoops shared a CryptoQuant chart showing that Bitcoin’s unspent transaction output (UTXO) profit share has been declining since mid-July, suggesting profit-taking.
Bitcoin UTXO refers to the amount of cryptocurrency remaining after transactions on the network. Analyzing this metric is crucial in understanding investor behavior over different time periods.
“Bitcoin UTXO profit margins fell to 68.5%, the lowest since October 2023,” Kyledoops said. explanation In a post by X on September 6th.
“The drop indicates selling pressure from profit-taking traders.” Percentage of Bitcoin UTXOs taking profits. Source: CryptoQuant
In general, reducing Bitcoin UTXO profits creates room for BTC to rise as sellers start to dry up.
The last time UTXO profits reached such levels was in January 2023, before Bitcoin’s price hit a new all-time high, rising 273% from $26,700 to $73,000.
“Historically, such declines have been preceded by larger price surges; Bitcoin's price has risen 273% after a similar drop.” This article does not contain investment advice or recommendations. All investments and trading involve risk and readers should conduct their own research when making any decision.
