Bitcoin price dropped to a multi-month-low of $49,105 on Aug. 5 as the crypto sell-off continued.
At its lowest point on Monday Aug. 5, Bitcoin (BTC) was down by over 33% from its highest point this year. While it did bounce back from below $50,000 to test the $55,000 level, it still remains in a deep bear market.
The prediction market is divided on what to expect later this year. According to Kalshi, a fast-growing prediction platform backed by Charles Schwab, Sequoia, and Henry Kravis, 76% of poll participants expect the Bitcoin price to end the year below $50,000.
Fifty-four percent of the participants see the coin falling below $40,000, while 20% of them expect it to drop below $30,000.
Meanwhile, according to Polymarket, fewer traders expect Bitcoin to rise to $100,000 this year. In March, 64% of the poll participants expected the coin to jump to that level. On Monday, the figure had dropped to 22%.
Bitcoin and other cryptocurrencies are falling as the industry faces substantial headwinds. The most recent data shows that spot Bitcoin ETFs shed over $65.4 million in assets.
Bitcoin’s futures open interest slipped to over $6.2 billion from last month’s high of over $8.8 billion. Additional data revealed that Bitcoin suffered $444 million in liquidations on Monday, while the entire industry had over $1.14 billion.
On the positive side, big investment firms like Blackrock, Fidelity, and MicroStrategy are not selling their coins. MicroStrategy is even raising funds to buy more coins.
Also, as we saw in March 2020, the Federal Reserve could start cutting interest rates even before the September meeting. Inflation has continued falling while the unemployment rate has risen to 4.3%.
Bitcoin price technicals are sending mixed data
On the daily chart, we see that Bitcoin peaked at $73,955 and then moved downwards to $49,104 on Aug. 5. Its lowest point was an important level since it coincided with the highest point on January 11. Bitcoin also dropped below the 200-day moving average, meaning that bears are in control.
Most importantly, Bitcoin has been forming a series of lower highs ($73,900, $72,000, and $70,000). It also formed lower lows at $60,730, $56,900, and $50,775. In most cases, this price action leads to more downwards movement.
On the positive side, Bitcoin has formed a falling broadening wedge pattern, a popular bullish sign. In this case, more upside will be confirmed if it rises above the 200-day moving average and rises above the upper side of the descending trendline.
Conversely, a drop below Monday’s low will invalidate the wedge pattern and point to more downside as sellers target the 50% retracement level at $44,840.
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