August performance and overall outlook

Bitcoin (BTC) had a disappointing month in August, with early and late month declines. Currently, the outlook for Bitcoin remains bearish, but certain macro-financial developments could change this trend.

What’s next for Bitcoin?

Currently, the price of Bitcoin is hovering below $60,000, having fallen 7.5% last week. This downward trend is likely to continue over the next month until the recovery that investors expect in October arrives. September has historically been a poor month for Bitcoin, with data showing an average value depreciation of 6.56%. Currently, investor sentiment is low, with Bitcoin fluctuating between $49,000 and $66,000.

The impact of macro-financial factors

Nevertheless, September's macro-financial markets may bring some changes. In particular, if the Federal Reserve cuts interest rates in September, this may help Bitcoin rewrite its historically negative performance. Rate cuts usually lead to increased US dollar liquidity, weakening the purchasing power of the US dollar, thereby enhancing Bitcoin's appeal as a means of storing value. Institutional investors may take this opportunity to buy a large amount of Bitcoin, pushing up its price.

MVRV Ratio and Market Outlook

The MVRV ratio is an indicator to assess investors' profits and losses. The current 90-day MVRV ratio of Bitcoin is -4.8%, indicating that investors are in a loss state, which is usually seen as an accumulation opportunity. From historical data, when the MVRV is between -2% and -12%, it often indicates the beginning of a recovery and rebound. Therefore, if this pattern repeats, Bitcoin may start to rise in late September.

There are two possible directions for Bitcoin price in September:

  1. Sustaining Below $68,300: Based on current market cues, BTC may continue to remain below the $68,300 resistance level. As the market remains biased towards the bearish side, this barrier may once again prevent Bitcoin from breaking out.

  2. Breakout above $68,300 and upside: If Bitcoin is able to break out of the descending wedge structure above $68,300, gains of up to 22% could occur, leading to new highs above $73,800. However, this optimistic forecast is premised on the realization of accumulation and rate cut factors, and only a breakout above $70,000 would confirm this bullish outcome.

in conclusion

Overall, Bitcoin is likely to remain consolidated below $65,000 in September. If it fails to break through this level, BTC’s rebound may be delayed until early or mid-October. If it can successfully break through key resistance levels in September, the market may usher in a significant rise, but this outcome will still require the cooperation of the macroeconomic environment.

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