Bitcoin’s poor trading action in recent months may continue for another month, as traders are in a state of uncertainty. August was particularly challenging for the leading cryptocurrency, with Bitcoin experiencing a 10.25% slide, its worst month since April. Ethereum also dropped significantly, with a 23.66% decrease, marking its third monthly drawdown and worst month since June 2022. The overall sentiment in the market is that while Bitcoin has seen some success due to ETFs in 2024, the rest of the crypto market has not followed suit and is struggling to keep up.
According to Rob Ginsberg, a chart analyst at Wolfe Research, Bitcoin is currently stuck in a descending trading range, with prices gradually declining since the March high. The trend has been characterized by lower highs and lower lows since peaking in March, indicating a bearish outlook for the near to mid-term direction of the price. Ginsberg predicts that Bitcoin may revisit the bottom of its range in the low $50,000 region in the coming weeks, further adding to the negative sentiment in the market.
Historically, September has been a challenging month for Bitcoin, with the coin finishing lower in eight out of the last 11 Septembers. The month also has the largest average loss of the year for Bitcoin at 4.8%, as per CoinGlass. The current price range of Bitcoin between $50,000 and $70,000 has been maintained since April and is likely to persist for another month at least. Despite some supply overhangs in Bitcoin, they have mostly been resolved or abated, positioning Bitcoin well from a supply standpoint moving forward.
Looking ahead, Bitcoin could remain rangebound until as late as November, with the looming U.S. presidential election playing a significant role in investor sentiment. Analysts suggest that a Trump victory could be a positive catalyst, while the impact of a Harris victory may be minimal. Clarity on rate cut expectations and the election outcome will likely have a significant impact on the future direction of Bitcoin’s price. The market is already factoring in significant rate cuts, but the question remains as to how many and when they will occur.
The future of Bitcoin trading appears uncertain, with tough times potentially ahead. Traders are advised to exercise caution and closely monitor market developments for any potential opportunities or risks.