After the cryptocurrency market struggled to maintain a bullish recovery in recent weeks following the August 5 crash, Bitcoin (BTC) prices led the altcoin sector in notable losses on Friday. Over the past two days, Bitcoin’s price consistently closed below the crucial support level above $57k, indicating that bears are in control. According to the latest market data, Bitcoin’s price dropped over 5 percent in the past 24 hours to reach a daily low of about $52,690. However, the flagship cryptocurrency rebounded above $53,800 on Saturday during the early Asian session. The total crypto market cap slipped below $2 trillion, following the forced liquidation of nearly $300 million.
Major Forces Weighing Down on Crypto-Bullish Outlook
September Bearish Chronicles
Amid the heightened fear of bearish sentiment in the coming weeks, Bitcoin’s price led the altcoin industry in notable losses over the past two days. The crypto industry mirrored major stock indexes’ bearish sentiments, despite rising calls for interest rate cuts on September 18. Bitcoin’s fear and greed index dropped to about 23 percent today, signaling extreme fear among traders. Most analysts believe the losses could continue in the near term, with Bitcoin’s price expected to drop below $50k.
Rising Whales’ Selloffs
According to on-chain data analysis, whale investors have increased the selling pressure in the past few weeks. For instance, Wintermute deposited nearly 47k Ether, worth over $104 million, to the Binance exchange in the past 24 hours. As for Bitcoin, investors who bought between $47k-$64k are feeling the squeeze, with only 27.6 percent of them currently in profit. On Friday, a giant whale deposited 1k BTCs, worth around $55 million, to Binance at a loss. This trend among large holders, often referred to as ‘whales,’ has exacerbated the downward pressure on Bitcoin prices.
Poor Performance in Spot Ether and BTC ETFs
In the past week, United States-based spot Bitcoin and Ether ETFs have been bleeding profusely. According to the latest market data, the US spot Bitcoin ETFs have registered a net cash outflow of nearly $1 billion, led by Fidelity’s FBTC. As for the spot Ether ETFs, they have recorded negative cash flows for the past four consecutive weeks. This poor performance in ETFs has further dampened the market sentiment, making it harder for prices to recover in the short term.
These factors combined paint a challenging picture for the cryptocurrency market in the coming weeks. While the long-term outlook for Bitcoin and other cryptocurrencies remains positive for many investors, the short-term market dynamics are likely to be dominated by bearish sentiments and increased volatility.
