Bitcoin Could Potentially Hit $54K Support Amid Bearish September, Predicts QCP
After a challenging August for Bitcoin, analysts at QCP Capital are anticipating a bearish September for the cryptocurrency, although there is potential relief on the horizon due to a possible shift in Federal Reserve policy.
The trading desk specializing in digital assets noted that Bitcoin’s historical pattern seemed poised to repeat itself, suggesting a potential 5% decline this month following the downward trend in August. September has historically been a tough month for Bitcoin, with six out of the last seven years seeing losses averaging around 4.5%. Despite this, QCP Capital believes that this decline could set the stage for a positive upward movement.
QCP Capital foresees Bitcoin finding support around the $54,000 mark, the same level from which Bitcoin rebounded before surging to $70,000 in July. Currently, Bitcoin is trading at $58,000, showing a nearly 2% increase amid a modest uptick in the broader market.
While September typically signals a bearish sentiment for Bitcoin, Philipp Zentner, CEO of Li.Fi, highlighted the potential impact of an anticipated change in U.S. Federal Reserve monetary policy. Following Fed Chair Jerome Powell’s remarks at the Jackson Hole speech, where he hinted at a shift in interest rates, investors are expecting rate cuts ranging between 25 and 50 basis points later this month.
Zentner pointed out several bullish indicators, including the rising dominance of Bitcoin, decreasing balances on crypto exchanges, and an increase in BTC miner supply entering the market. Bitcoin’s dominance has climbed to 58%, with investors favoring Bitcoin over alternative cryptocurrencies like Ethereum, which have lagged behind.
Recent data from CoinGlass revealed a significant outflow of billions in BTC from exchanges such as Binance and Coinbase over the past month. In June, balances of BTC and ETH on exchanges dropped to a four-year low, indicating a positive investor sentiment. However, market sentiment remains mixed as the community awaits the potential rate cuts.
In summary, Zentner emphasized the potential for a substantial market rally driven by robust Bitcoin fundamentals, a stablecoin market with ample capital, and the prospect of a more favorable monetary policy environment. These combined factors position Bitcoin and the broader market for a bullish phase as the year progresses.
