Bitcoin continues to show weakness as the BTC price can move towards $24,000-25,000 as it goes to test the 200-week EMA once again.
On Thursday, August 31, the world’s largest cryptocurrency Bitcoin plummeted by more than 4.5% with its price slipping under $26,000, losing all the early week gains after the Grayscale court ruling. The selling pressure on BTC and its price comes as the US Securities and Exchange Commission (SEC) announced its decision to delay the approval of seven spot Bitcoin ETF applications.
This includes applications from giants such as BlackRock, VanEck, Valkyrie, and others. Also, the strengthening of the US Dollar has put pressure on asset prices across the financial markets.
Stocks displayed a mixed performance following the release of the Personal Consumption Expenditures (PCE) Index, which highlighted persistent high inflation. Additionally, a rebound in the DXY exerted downward pressure on assets that managed to record price gains on Thursday. As the trading session concluded, the S&P and Dow closed in negative territory, with losses of 0.16% and 0.48%, respectively. In contrast, the Nasdaq edged up by 0.11%.
Crypto analysts have been weighing as to when would the US SEC approve the first spot Bitcoin ETF in the US. Grayscale’s victory against SEC has made analysts bullish with a 75% chance of the spot Bitcoin ETF coming by the end of 2023.
Michaël van de Poppe, the founder of MN Trading, shared his analysis of the situation via X (formerly Twitter), suggesting a higher probability of the SEC granting approval for an application in either October or December. He also anticipated that there would be an approval for the Ethereum ETF Futures in October.
Regarding the price movement of Bitcoin (BTC), Poppe stated that it is currently navigating a challenging zone. He highlighted that over $250 million in liquidations occurred during the recent correction, causing Open Interest to retreat to levels observed within that range.
BTC Price Technical Charts
According to data from TradingView, Bitcoin initially found support at $27,000 in the morning but later experienced a significant sell-off during the afternoon. This downturn saw the price of Bitcoin drop to as low as $25,925 before buyers were able to push it back above the $26,000 mark. As a result, the gains achieved after Tuesday’s Grayscale ruling were completely wiped out.
While Tuesday’s price movements in the Bitcoin futures market signaled “a bullish upside breakout from the recent sideways trading range,” as noted by Kitco’s senior technical analyst Jim Wyckoff, the overall market structure remained largely unchanged. Wyckoff pointed out that a downward price trendline continues to be present on the daily chart.
Some of the inherent weakness in the Bitcoin price shows that it might slip further in correction towards $24,000-25,000 as it goes to test the 200-week EMA once again.