- Over 80% of Bitcoin’s long-term holders are currently in a profitable position, which heightens the likelihood of profit-taking and sending BTC prices lower.
- Bitcoin’s price action is forming an ascending triangle pattern, which could lead to a breakdown toward $50,000 or a breakout targeting $70,000.
- Bitcoin’s price may follow gold’s upward trajectory, and potential interest rate cuts by the Federal Reserve could further boost its upside outlook.
Bitcoin’s price has rebounded recently after crashing to a six-month low. However, owing to technical and on-chain indicators, the cryptocurrency may undergo further correction in the coming weeks.
Over 80% of Bitcoin’s Long-Term Traders Are Still in Profit
BTC’s ongoing correction cycle has accompanied a decline in the percentage of long-term holders in profits. As of Aug 16, nearly 83% of these matured Bitcoin holders were in a profitable position. A high number of BTC held in profit is often seen as a sign of FOMO, which typically precedes price corrections.
Ascending Triangle Breakdown May Send BTC Price to $50K
Bitcoin’s ongoing consolidation moves are appearing inside an ascending triangle pattern. This indicates a potential reversal or weakening of the downward momentum. However, the ascending triangle might act as a continuation pattern in a downtrend if the price fails to break out above resistance. A decisive break below the triangle’s lower trendline will likely trigger a breakdown, sending Bitcoin’s price toward $50,000.
Bitcoin May Not Crash After All
Ascending triangles are considered bullish reversal patterns in a downtrend. Therefore, Bitcoin’s decisive close above key resistance could increase its probability of rallying toward the upper trendline around $59,240. Meanwhile, a successful close above the upper trendline will likely trigger a breakout toward $70,000.
Federal Reserve’s Potential Rate Cuts May Further Boost Bitcoin
Lower rates reduce the opportunity cost of holding yielding assets, boosting appetite for riskier assets like crypto. Upcoming potential rate cuts by the Federal Reserve may further boost Bitcoin’s upside outlook.
Conclusion
While technical and on-chain indicators point to potential further downside for Bitcoin price in the short term, the overall long-term outlook remains bullish. Key levels to watch will be a break below the ascending triangle support at $50,000, or a breakout above the resistance at $59,000.
