Despite increased demand from institutional investors, Bitcoin prices are experiencing medium-term bearish sentiment, with some analysts predicting a drop below $50,000 in the near term.
Bitcoin fell more than 2% in the past 24 hours to trade at around $58,766 in mid-London on Monday. However, the leading digital coin gained more than 7% last week, signaling a possible recovery ahead. With less than two weeks to go before the much-anticipated fourth quarter, Bitcoin is clearly gearing up for its bull run.
Furthermore, Bitcoin Dominance has continued to rise in recent times and hit a multi-year high of around 58% earlier today. According to popular crypto analyst Benjamin Cowen, Bitcoin Dominance will continue to rise to 60% before correcting in 2025 to pave the way for the anticipated altcoin season.
Medium-term target for Bitcoin price
From a technical perspective, Bitcoin price has significantly reversed the downtrend it started earlier this year. After recovering from weekly support above $54,000, Bitcoin price is now aiming to retest its all-time high in the near term.
According to popular cryptocurrency analyst Ali Martinez, Bitcoin price has formed an ascending channel on the 1-hour time frame. Therefore, the analyst predicts that Bitcoin price will rise to $62,000 if buyers defend the support level around $58,000. On the other hand, he also emphasized that a drop to $55,000 for Bitcoin is inevitable if the support level of $58,000 fails to hold.
On the hourly chart,#Bitcoinis moving within a parallel channel. If the lower limit holds, $BTC could recover to the mid-range or upper-range around $60,200 or $62,000. However, a break below the $58,100 support could see a drop to $55,000. pic.twitter.com/5JbnrGRjYE
— Ali (@ali_charts) September 16, 2024
On the weekly timeframe, Bitcoin price has recovered from the 50-day moving average (MA) but has failed to reclaim the 50% level on the relative strength index (RSI). Therefore, Bitcoin price closes in the next few days will have a big impact on the monthly close.
Mixed reactions from whales
While fears of a crypto sell-off have been easing in recent days, on-chain data shows a mixed reaction from large investors. For example, a whale sold 500 Bitcoins this morning, worth over $30 million, but still holds nearly 300 BTC.
A whale sold 500 $BTC ($30.07 million) 12 hours before Bitcoin price dropped.
This whale made three trades with Bitcoin but only made a profit on the first one, losing money on the next two.
Still holding 259.6 $BTC (15.15 million USD), with a total loss of over 6 million USD!
Address:… pic.twitter.com/w4Rkqbvg5g
— Lookonchain (@lookonchain) September 16, 2024
Meanwhile, the US spot Bitcoin ETF recorded a net inflow of over $403 million last week. Led by Fidelity’s FBT, US spot Bitcoin ETFs are expected to continue accumulating more cryptocurrency as the country prepares for the 2024 presidential election.
Economic outlook
As gold prices surged to an all-time high (ATH) this morning, Bitcoin prices are expected to follow suit in the near term. This bullish sentiment is reinforced by the fact that most traders expect the Federal Reserve to cut its benchmark interest rate on Wednesday.
Furthermore, inflation in the US has fallen significantly to below 3% from above 7% over the past few years.
Additionally, the European Central Bank and the Bank of Canada have made multiple interest rate cuts this year to boost economic activity in their regions.
