The euphoria that has swept across the cryptocurrency ecosystem over the past few weeks was rigged on August 26 when an early morning attempt by cops to push the price of Bitcoin down to $ 50,000 was resolutely rejected.
Data from Cointelegraph Markets Pro and TradingView show that Bitcoin’s price fell to a low of $ 46,457 after its rejection, before the bulls managed to regroup and halt the downturn.
Here’s what analysts say about Bitcoin’s price movement on Thursday and a few things to watch out for as the digital asset is caught between a bull and bear tug-of-war.
BTC price could trend south for a while
The USD 50,000 price level was identified as a critical area for Bitcoin by market analyst and Cointelegraph employee Michaël van de Poppe, who posted the following tweet outlining the significant support and resistance areas.
Couldn’t break the critical area for #Bitcoin.
Could make a slight upswing here but the overall trend is a little south.
Massive support of around $ 44,000.
Invalidation if an outbreak over $ 49,000 (and mostly $ 51,000) occurs. pic.twitter.com/d7gTuHKCvA
– Michaël van de Poppe (@CryptoMichNL) August 26, 2021
According to van de Poppe, Bitcoin will likely spend some time in a downtrend after this recent pullback, but there is significant support at the $ 44,000 level that could protect it from further decline.
The price level of USD 51,000 was described by van de Poppe as an important price that needs to be overcome in order to counter the current downtrend.
The analyst said:
“It’s obviously not a bear market, but the general consensus is that emotions can get the better of you. Especially if Bitcoin corrects even further towards USD 44,000 or possibly USD 42,000, the “Long Bear Cycle” issue will begin to gain the upper hand. “
Traders expect the $ 46,200 support to hold
According to on-chain data, calls for a long bear cycle are premature at best, according to Whalemap, a crypto-focused data tracking service.
As can be seen in the graph provided, the $ 46,200 support level is important as the next support level is at $ 39,600. On-chain data also shows that sales volume is capped between $ 46,200 and $ 57,400.
Whalemap analysts said:
“No reasons to be bearish yet. The risk reward looks pretty positive when you look at the on-chain data. Many UTXOs stayed unspent at $ 46,200 and didn’t have much pressure to sell until $ 57,400. “
Related: Grayscale Bitcoin Trust FUD is now over as the last GBTC unlock is only 58 BTC
Profit taking of $ 50,000 was expected
Crypto analyst Will Clemente gave some comforting words on Aug. 24 when he warned of a possible short-term bearish pullback due to exchange inflows and whale wallet activity.
I’m bearish for the short term.
Decline in the illiquid supply ratio and the coins that go to the stock exchanges. Also see some sales of whales. pic.twitter.com/nRhdB2GuSp
– Will Clemente (@WClementeIII) August 25, 2021
Thursday’s market retreat showed that Clemente’s concerns were legitimate, and the analyst followed up the previous tweet with, “I think most of this short-term move is likely over.”
In a separate tweet, Clemente said:
“It’s not unexpected to see profit taking as it climbs to $ 50,000, but are you watching the speed at which this is happening and, more importantly, are sellers ready to sell at a loss? Some hints can be provided by Realized P / L, SOPR, SOAB, ASOL and Realized Gradient. “
The total market cap of the cryptocurrency is now $ 1.999 trillion and the dominance of Bitcoin is 44.2%.
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