At press time, Bitcoin is trading at 115,800 dollars, roughly 6 percent below its all-time high of 124,128 dollars recorded on Wednesday, according to CoinMarketCap. The latest rally, which delivered a 10 percent gain in just nine days, “quickly fizzled out” due to a lack of macroeconomic catalysts, Bitfinex analysts explained in their latest market report.
Sideways action expected
With momentum cooling, analysts anticipate Bitcoin may consolidate over the coming weeks. “The market is now firmly in a consolidation phase, adopting a wait and watch stance as investors weigh upcoming macro catalysts,” Bitfinex wrote.
One such catalyst is the United States Federal Reserve interest rate decision on September 17, with the CME FedWatch Tool showing that 83.6 percent of traders expect the long awaited cut.
Historically, when Bitcoin touches new highs and then begins to stabilize, many investors opt to lock in profits, fearing a local top. This trend appears to be unfolding once again.
Short positions and whale accumulation
Data from CoinGlass shows that around 2.2 billion dollars in Bitcoin short positions are at risk of liquidation if BTC manages to retest its 124,128 dollar all time high.
Despite these pressures, Santiment highlighted that large Bitcoin holders remain confident. “Bitcoin’s largest holders are not selling into this rally. Wallets holding between 10 and 10,000 BTC have continued to accumulate aggressively, even after the all time high,” Santiment said.
This divergence between retail traders potentially taking profits and whales steadily accumulating has fueled debate about Bitcoin next move. For now, the market appears to be in a cautious holding pattern.
