Every fluctuation of Bitcoin affects the hearts of countless investors. Recently, Bitcoin seems to be undergoing a profound adjustment, but there are signs that this adjustment may be coming to an end, and a new upward cycle is quietly brewing.
Subtle changes in adjustments
Since the global market crash on August 5, the price of Bitcoin has plummeted by more than 25%, and the market is in an uproar. However, amid the panic, it is not difficult to find some positive signs. Bitcoin has shown signs of bullish divergence on the weekly chart - although the price is falling, the relative strength index (RSI) has formed a higher low. This divergence, like a ray of sunshine in winter, indicates that the downward momentum is gradually weakening, and the upward reversal may not be far away.
Even more exciting is that Bitcoin seems to have formed a long-legged cross candlestick pattern last week. This pattern often appears at the turning point of the trend, indicating a subtle change in market sentiment. Combined with the increase in trading volume near the trend line of the bull flag pattern, it is not difficult to see that traders are full of confidence in the rebound of prices. This may mean that by September, Bitcoin is expected to return to the upper trend line of the flag near $66,500, opening a new chapter of growth.
The movement of whales is a barometer of the market
The bullish reversal signal in the Bitcoin market is not isolated. On-chain data shows that "whales" holding at least 1,000 BTC are withdrawing Bitcoin from exchanges in large quantities, the largest scale since 2015. This behavior is seen as a strong bullish signal because it shows that these large investors prefer to hold Bitcoin for the long term rather than rushing to cash out. History is always strikingly similar. Similar actions by Bitcoin whales in 2015 were followed by a magnificent bull run.
Macroeconomic support
In addition to changes within the market, the macroeconomic environment also provides strong support for the rise of Bitcoin. Data from the Chicago Mercantile Exchange shows that the market's confidence in the Federal Reserve's interest rate cut in September is almost 100%. The expectation of a rate cut not only reduces borrowing costs, but also increases the market's preference for risky assets, and Bitcoin naturally benefits from it.
However, this week's inflation data will be key to determining the Fed's interest rate outlook. If inflation data continues to fall, the possibility of the Fed cutting interest rates in September will increase further, which will undoubtedly inject more momentum into risky assets such as Bitcoin. On the contrary, if inflation data rises unexpectedly, it may trigger market volatility and bring short-term pressure to Bitcoin.
There is light at the end of the tunnel, but caution is needed
In summary, the adjustment of Bitcoin seems to be coming to an end, and a new upward cycle may be ready to start. However, we must also be aware that the market is always full of variables. While enjoying potential gains, we should remain cautious and pay close attention to changes in market dynamics and the macroeconomic environment. Only in this way can we move forward steadily in the wave of digital currency.
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