Bitcoin Weekly Roundup: Essential Updates
With severe volatility, Bitcoin‘s wild August continues as the week begins with a decline below $60,000. The price action of Bitcoin is struggling to regain its bullish narrative following an equally dramatic drop to six-month lows, followed by a spectacular recovery of lost ground.
Although there are many volatility catalysts ready to deliver some surprises, the stage is already set for the ongoing war between bulls and bears. The most important one is derived from sources outside of the cryptosphere, specifically US macroeconomic statistics. Let’s take a closer look at 5 key factors affecting the market.
Bitcoin Ends Week Volatile, Closing Above $58,700 After Recent Lows
Bitcoin increased its volatility into the weekly close following a quiet weekend, with large-volume traders being blamed for the last-minute decline. Hence, the closing itself came in at just over $58,700, according to statistics from TradingView and Cointelegraph Markets Pro, representing only a minor recovery from the $10,000 losses from the previous two weeks. Local lows of $57,700 were recorded on Bitstamp during the August 12 Asia trading session, which maintained the erratic pattern.
Lower timeframes are all over the place, but the weekly chart tells a different story. 165 days of mid-cycle consolidation. This cycle ain’t over.
popular trader Jelle
Meanwhile, buyer liquidity was observed at $57,700 and below on August 12, according to the most recent data from the monitoring portal CoinGlass. With a focus on $61,000, heavy ask ladders continued to hover above.
Bitcoin Sees Double Death Crosses: Are Bulls Out of Options?
The trading community has taken note of the troubling situation in which Bitcoin has managed to establish two distinct “death crosses” in the last week. These involve four trendlines: the 21, 50, 100, and 200-day simple moving averages (SMAs), as reported by Cointelegraph.
Co-founder of Material Indicators Keith Alan acknowledged in X comments on August 11 when uploading a little clip of video analysis that Bitcoin Bulls were not able to avoid the second Death Cross. Nevertheless, Alan said that bullish volatility can still offset the effects of death crosses, making them “not the be-all and end-all” for the market.
US Inflation Data Set to Shake Markets: CPI and PPI Reports Loom
This week’s CPI and PPI prints could arguably not come at a worse time for risky asset traders. Any surprises will add to the complex picture of US inflation, with the Fed already under pressure to lower interest rates at its next meeting in September. The volatility that occurred last week, mostly focused on Japan, only made it more imperative for the Fed to act, but as of right now, the rates are at their highest points in over 20 years.
“We have a busy week ahead,” trading resource The Kobeissi Letter summarized in one of its latest X threads. Kobeissi noted that the VIX volatility index remains elevated after hitting its third-highest levels in history last week.
Bitcoin Mining Difficulty Faces 3.6% Drop as Hash Rate Remains Strong
At its next automated readjustment on August 14, mining difficulty is anticipated to produce a slight drop. As of the time of writing, estimates from the monitoring resource BTC.com place this at roughly 3.60%. Though rather normal for 2024, which has seen multiple declines of more than 5%, this will be the first difficulty drop in six weeks.
Meanwhile, raw data from MiningPoolStats reveals that the hash rate is still hovering around record highs. This demonstrates how resilient the mining industry is becoming as it adjusts to the post-halving environment.
Crypto Market Sentiment Turns Volatile: Fear & Greed Index Hits Extreme Fear
The sentiment of traders is as volatile as the cryptocurrency markets themselves. Large swings in the Crypto Fear & Greed Index‘s most recent numbers reflect the erratic nature of market sentiment.
Fear and greed fell to a low of 17/100 on August 6, which was the lowest since July 2022 and even lower than the response to the FTX crisis at the end of that year. After a few days, the price of bitcoin recovered, moving from “extreme fear” to neutral and reaching 48/100 before declining once more. Consequently, even in the absence of a price decline, as of August 12, cryptocurrency is once again the “extreme fear.”
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