- The price of Bitcoin experienced a rise again yesterday and reached $26,843 with a 3.7% increase after the recent decline from $29,000.
- Currently, there are 156,660 wallets with a balance between 10 and 10,000 BTC, and they have a total accumulation of $308.6 million since August 17.
- Decentrader emphasized the prevailing market sentiment, stating that despite the price increase of Bitcoin, there is still a sense of uncertainty and fear. This sentiment is further highlighted by the ongoing negative decline in average funding rates.
What are the factors that triggered the rise in the price of Bitcoin after the sharp decline last week?
Reasons for the Rise in Bitcoin Price Movement
The price of Bitcoin experienced a rise again yesterday and reached $26,843 with a 3.7% increase after the recent decline from $29,000. There are various reasons behind this rise.
According to on-chain analytics firm Santiment, significant Bitcoin holders, often referred to as whales and sharks, are actively adding to their holdings. Currently, there are 156,660 wallets with a balance between 10 and 10,000 BTC, and they have a total accumulation of $308.6 million since August 17. Whale and shark wallets have added 11,629 BTC in the past six days.
Michaël van de Poppe, a respected crypto analyst, highlighted the strength shown by Silver and Gold, especially after the disappointing PMI rates yesterday. In a period where high returns seem to have peaked, Bitcoin may follow the trajectory of these commodities.
The latest economic indicators from the US private sector provide further context. S&P Global Composite PMI data for early August showed a decline, dropping from 52 in July to 50.4. Manufacturing and Services PMI indices also recorded declines from 49 to 47 and from 52.4 to 51, respectively.
In addition, the Bitcoin futures market definitely played a role in yesterday’s Bitcoin price movement. A total of $28.06 million worth of short position liquidation occurred in this market. As a result, this is the third largest amount in August, surpassed only by August 17 ($120 million) and August 8 ($37 million).
Decentrader, a market intelligence platform, emphasized the prevailing market sentiment, stating that despite the price increase of Bitcoin, there is still a sense of uncertainty and fear. This sentiment is further highlighted by the ongoing negative decline in average funding rates. While this indicates that the sentiment is still negative, it opens up the possibility of further short squeezes if traders attack short positions.
The inverse relationship between the Dollar Index (DXY) and Bitcoin also played a role. DXY was rejected just below 104 yesterday and fell to 103.5. SPX provided a pleasant relief as USD dropped from 103.96.
CryptoCon’s volume analysis provides a broader perspective on Bitcoin’s price movement. Since November 2020, the trading volume of Bitcoin indicates why the price has stalled at its current position. The volume above $28,900 appears to be a significant obstacle. However, the range between $24,000 and $29,000 has not yet been explored, indicating that Bitcoin is in search of new support and preparing for a potential transition to the next resistance zone.
What’s next for Bitcoin?
Tomorrow – Friday – an important event will take place, the Jackson Hole Economic Symposium, where the Federal Reserve will discuss its future strategies. Keith Alan highlighted the impact of last year’s symposium on Bitcoin, saying, “Do you remember when Fed Chairman Powell spoke at Jackson Hole last year and triggered a 29% BTC drop with his hawkish tone?”
Although there may be similarities in the price movement of Bitcoin before this year’s event, it is important to remember that market reactions can be unpredictable and based on various factors. As the Bitcoin market prepares for tomorrow’s events, the prevailing sentiment is a mixture of expectation and caution.
