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Key Takeaways:
- Bitcoin rebounds from three-week lows, with $116.5K emerging as a key short-term resistance and liquidation zone.
- Whales and short-term holders trigger a major sell-off, but long-term demand and accumulation remain strong.
- Fed rate cut bets return for September, adding macro-driven volatility to Bitcoin’s August outlook.
Bitcoin (BTC) enters the first full week of August trading near $114,331, recovering from a dip below $112,000. The price bounce has revived hopes of upward momentum, with some analysts targeting $116,500 as a key liquidation level and potential short-term magnet. However, traders remain divided over whether the worst of the retracement is over or if more downside awaits.
Mixed Technical Signals and Macro Crosswinds
Technical analysts like BitBull and Daan Crypto Trades suggest BTC is showing bullish signs, including a daily close above its 50-day simple moving average (SMA). Still, the historically low monthly price volatility—just a 3.6% range so far—indicates a larger move is likely, though direction remains uncertain.
Meanwhile, macroeconomic factors loom large. Market participants have returned to pricing in a 0.25% Federal Reserve rate cut in September, following weak U.S. jobs data. With multiple Fed speakers due this week, any dovish tone could influence both equities and crypto markets.
Whales Join Sell-Off as Accumulators Stay Strong
On-chain data from CryptoQuant shows a notable spike in BTC inflows to exchanges from both whales and short-term holders (STHs), signaling a broader de-risking trend. On August 1, over 40,000 BTC were moved to exchanges at a loss. The whale exchange ratio surged, further pressuring prices.
Also Read: Metaplanet Adds 463 Bitcoin, Plans $3.7B Raise as Crypto Market Rebounds
Despite the sell-off, demand fundamentals remain resilient. Accumulator wallets, which strictly purchase BTC without spending it, added 50,000 BTC in the past month, while long-term demand indicators like Apparent Demand stayed positive. OTC desk holdings now exceed 500,000 BTC, up from just 145,000 in 2021.
Outlook: High Volatility, but No Panic
While Bitcoin’s recent dip triggered broad selling, especially from leveraged and short-term players, the underlying demand metrics remain bullish. With eyes on $116.5K and the Fed’s next move in September, traders can expect volatility to remain elevated.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!
