Bitcoin’s tumultuous journey took another downward turn as the digital currency plummeted to its lowest levels since early July. The descent, witnessed on Friday as Wall Street opened, sent shockwaves across cryptocurrency exchanges, leaving traders scrambling to reassess their short-term strategies. Data from CoinGlass revealed a staggering $540 million in crypto liquidations over a 24-hour period, triggered by intensified selling pressure.
Whales and Exchange Dynamics
The recent upheaval was exacerbated by significant sell-offs from so-called “whales”—large Bitcoin holders—who played a pivotal role in the price drop. Reports from market analysts highlighted Binance’s trading activities as a significant contributor to the sell-off, amplifying the losses. Bitcoin saw nearly a 5% decline in value during the day, with some large accounts linked to the wave of sales that resulted in automatic sell orders and hasty market exits. This aligns with recent observations in Bitcoin whales send BTC price under $109.5K as market ‘wobbles’ into US PCE, where whale activity has been a notable market mover.
Daan Crypto Trades, a well-known trader, pointed out a “key reversal zone” at recent ranges and consolidation levels. “Bitcoin never managed to establish $112,000 as a support level,” he remarked, while other market voices underscored the importance of a $114,000 weekly close for bullish momentum.
Flicker of Hope Amidst the Tumult
Yet, all isn’t lost. Savvy technical analysts found a glimmer of hope amid the chaos. Javon Marks, a respected crypto commentator, noted a bullish RSI divergence on the four-hour chart—a pattern where the Relative Strength Index (RSI) forms higher lows even as prices drop, hinting at a potential reversal. Marks speculated that Bitcoin might claw its way back to the $123,000 mark, a potential 14% increase from its current standing. This sentiment echoes strategies discussed in Large Liquidations Mask Whale’s Buy-the-Bitcoin-Dip Strategy: Crypto Daybook Americas, where some whales are seen capitalizing on the dip.
However, this optimism hinges on a swift shift in momentum favoring buyers, a scenario that remains uncertain given the prevailing market dynamics.
Macro Challenges and Seasonal Trends
Adding to Bitcoin’s woes are macroeconomic factors and seasonal trends. Historically, September hasn’t been kind to Bitcoin, and the market is bracing for potential volatility. Investors are keenly observing U.S. inflation data, especially the Fed’s preferred Personal Consumption Expenditures index, which recently met expectations, hinting at an inflationary uptick.
Despite this, the CME Group’s FedWatch Tool indicates a market expectation for rate cuts in September—a potential boon for risk assets like cryptocurrencies if realized.
Navigating the Tightrope
For now, traders are treading carefully, with a laser focus on critical price markers. The $112,000 and $114,000 thresholds are pivotal; reclaiming these could provide the much-needed reprieve for bulls. However, failing to hold these levels could invite further downside pressure and trigger additional liquidations.
As the U.S. approaches key economic data releases and the Federal Reserve’s decision window on September 17, market participants remain on tenterhooks. The interplay between technical signals, macroeconomic data, and large sellers continues to shape the market’s cautious sentiment, leaving traders and investors alike navigating a precarious path forward.
In the end, while some technical indicators hint at potential recovery, the broader market backdrop suggests a complex landscape—one where caution and vigilance are paramount as Bitcoin navigates these turbulent waters.
Source
This article is based on: Bitcoin Hits 7-Week Low As $540-M In Trades Wiped Out
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
