BTC Market Faces Seller Dominance: Analyst Predicts $5,000 Short-Term Decline
BTC Market Faces Seller Dominance – Bitcoin’s (BTC) rapid recovery from a dip below $50,000 last Monday has momentarily reignited bullish sentiment, with some market analysts forecasting a potential rally to $90,000 or beyond. However, recent analysis indicates a shift towards a more cautious outlook.
Analyst Warns of Short-Term Decline
Alex Kuptsikevich, a senior market analyst at FxPro, has expressed concerns about Bitcoin’s short-term prospects. According to Kuptsikevich, the cryptocurrency is more likely to experience a $5,000 drop rather than an equivalent rise. His bearish stance is attributed to Bitcoin’s inability to maintain gains above $60,000 following the formation of a death cross, where the 50-day simple moving average (SMA) crosses below the 200-day SMA.
Seller Dominance Observed Above $60,000
Kuptsikevich noted that Bitcoin struggled to break above the $60,000 level and faced increased selling pressure after attempting to surpass the 50- and 200-day moving averages late last week. This trend indicates a prevailing seller dominance in the market. The analyst also pointed out that the 14-day relative strength index (RSI) has moved out of oversold territory, suggesting limited room for further upward momentum.
RSI Analysis and Market Momentum
The 14-day RSI, a momentum oscillator that gauges the speed and change of price movements, previously indicated oversold conditions after last Monday’s downturn. However, the RSI’s exit from the oversold zone signals a loss of momentum for additional strength. This shift in momentum aligns with the recent seller dominance observed above the $60,000 mark.
Impact of Upcoming U.S. CPI Data
The short-term outlook for Bitcoin may be further influenced by upcoming U.S. consumer price index (CPI) data, set to be released on Wednesday. Should the data reveal persistent inflation, it could diminish hopes for Federal Reserve rate cuts in the near future, potentially exacerbating Bitcoin’s price weakness.
Election Dynamics Affect Bitcoin
Bitcoin’s price saw a bounce back above $60,000 late last week, recovering more than 50% of the decline observed over the five days leading up to August 5. However, the recovery has since stalled, with pro-crypto Republican candidate Donald Trump losing ground to rival Kamala Harris in prediction markets related to the U.S. elections scheduled for November 4.
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