Bitcoin: Short-Term Downtrend Gaining Steam With $50K Support Test Likely

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Bitcoin: Short-Term Downtrend Gaining Steam With $50K Support Test Likely

’s current price action reflects market indecision. Despite recent dips, the crypto ******** within a downward channel that also fits into a broader uptrend.

Over the next few weeks, key factors to watch will be the shifting dynamics of US presidential election polls and the Federal Reserve’s interest rate .

In the short term, recent declines are largely due to substantial outflows from ETFs, which weigh on buying pressure. Technically, Bitcoin hasn’t yet signaled a breakdown, though a drop below the crucial $50,000 support level could change that.

September’s Historical Challenge for Bitcoin

Historically, September hasn’t been kind to Bitcoin. Over the past five years, the digital currency has averaged an 8% decline during this month, only to rebound in the final quarter. For a sustained uptrend, several conditions need to align:

1. Fed Interest Rate Cut: Lower interest rates generally benefit digital currencies, which don’t offer passive income like bonds.
2. Potential Trump Victory: Donald Trump has shown a favorable stance towards Bitcoin, even suggesting its inclusion in the Strategic Reserve System.
3. Stop ETF Fund Outflows: Halting the outflow of funds from ETFs would support Bitcoin prices.

If these conditions aren’t met, we might see continued supply pressure on Bitcoin. As for the presidential race, yesterday’s debate didn’t produce a clear frontrunner, with both candidates tightly contested in the polls.

Bitcoin: Technical View

Bitcoin is currently caught between support and resistance levels, reflecting market uncertainty.

The cryptocurrency is trading roughly halfway between these two critical levels, which suggests that traders are unsure about the next move.

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For Bitcoin to initiate a bullish reversal, it must first overcome the $64,000 resistance zone. This level has acted as a significant barrier, and breaking through it would signal a potential return to an upward trend.

On the downside, the $50,000 support level ******** a pivotal point. This area has shown strong price reactions in the past, indicating that buyers might still be active and ready to defend this level.

If Bitcoin falls below $50,000, it could signal a more significant downturn ahead.

Ethereum’s Double Bottom Potential?

Ethereum has faced significant selling pressure, pushing it toward a strong support zone around $2,200.

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We’re currently seeing some consolidation within this area, which could form a double-bottom pattern with a target near the $2,800 resistance level. However, if Ethereum drops below $2,200, it may test the $2,000 support level.

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Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute a solicitation, offer, recommendation or suggestion to invest. I would like to remind you that all assets are evaluated from multiple perspectives and are highly risky, so any investment decision and the associated risk is at the investor’s own risk. We also do not provide any investment advisory services. We will never contact you to offer investment or advisory services.

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