After peaking at $25k on Sunday, continuing to trade sideways in the $24k range, and now falling to the $23k level, Bitcoin is struggling to hold current support as trading volume continues to decline. While the cryptocurrency market remains above the $1 trillion market cap range, BTC and ETH are seeing single-digit-percent losses this week of 3-4%. With Bitcoin and Ethereum behaving, we’ll likely continue to see the crypto assets testing support and decline until next week.
Key Points:
Looking at the monthly bitcoin price chart, we can see that despite a dip to $20k and a few peaks above the $24k range, BTCUSD’s preferred range is the $23-$24k area.
1M BTCUSD // Source: CoinMarketCap
Bitcoin will continue trading within that range, slowly attempting to turn the $24k resistance level to support. BTCUSD continues to follow stock market price action, closely following tech indexed like the NASDAQ.
Unfortunately, even though the NASDAQ has been performing quite well this month, rising by over 25%, Bitcoin is yet to show substantial gains in August.
With news of miners exhibiting significant losses last quarter, comprising over $1 billion in losses between four major miners, investors are still wary of opening long-term bullish positions with BTC.
Moreover, Coinbase’s Q2 earnings also revealed close to $1.1 billion in losses in revenue from the crypto winter this year, compared to an over $1 billion profit during the same period last year.
The good news is that cryptocurrency markets remain above the $1 trillion level, and Bitcoin is managing to trade within a narrow range. The longer BTCUSD holds support, the more likely it will break out past the $25k range and attempt to break its three-month high of $30k. If Bitcoin surpasses the $30k range in the next several weeks, FOMO will push the cryptocurrency even higher, creating a snowball effect and causing a massive bull run.
In addition, we could also see Ethereum’s price show substantial growth come September, as ETH’s network is scheduled to transition from a proof-of-work to a proof-of-stake network. This will make ETH the largest sustainable blockchain, and the “merge trade” could fuel Ethereum’s next major bull run that could cause it to overtake Bitcoin in terms of market cap in an event dubbed “The Flippening.”
With crypto markets relatively quiet, now could be an excellent opportunity to open long-term positions in underrated and undervalued projects. If you’re looking to invest in virtual real estate, NFTs, and the Metaverse, current low prices are excellent for long-term holds.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any service.
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Image Source: promesaartstudio/123RF // Image Effects by Colorcinch
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