Market Overview

The cryptocurrency market opened the week in a defensive mode-dipping 1.2% to a total market capitalization of $2.27, anything but shy of its earlier sentiments. It remains up by 3% from a week ago, notwithstanding this dip, on the weak-breathing profit-booking after a burst rally brought about by concerns over the runoff jobs report and comments made by Federal Reserve Chair Jerome Powell.

Bitcoin goes on a Monday fall of 2.6%, being reduced to $64,000. From a technical standpoint, Bitcoin is hitting resistance around the upper side of a broad multi-month downtrend. Nevertheless, the sentiment-driven mechanism-now in a dip-seems to take over on this one as the earlier break above critical levels, especially 200-day moving averages, typically marked potential strong bullish momentum.

Notably immune to the ongoing correction, Bitcoin remains set for its best September since 2012, having garnered close to 11% gains this month. This is in sharp contrast to the typical September fall. The broader altcoin market features gains of over 20%, buoyed by eased financial conditions amid the rolling interest rate cuts by the Fed, ECB, and PBC.

Last Friday, Bitcoin ended the week on a high note, closing at about $66,500-an increase that marked its highest level since late July. Positive momentum in U.S. spot Bitcoin ETFs persisted through all five sessions of trading this week.

News Background

Research firm 10x Research claims that the pullback in Bitcoin is a typical correction following the overbought phase. Bitcoin has experienced corrections each month during the first week since June.

If critical support of around $63,000 holds, it could initiate another rally in Bitcoin, by DecenTrader. Bitcoin’s long-to-short ratio is presently at an extremely low level, a pattern that historically precedes growth of the asset.

Michaël van de Poppe, founder of MN Trading, says the cryptocurrency market has favorable conditions~for Bitcoin as the U.S. labor market begins to weaken and distrust of established financial institutions grows. Van de Poppe estimates Bitcoin’s price will reach $192,000 by the end of 2021 and that by next year, that will be $600,000.

FalconX notes that by mid-2025, the rate commissioned by the Fed is likely to dip below that of the yield rate of Ethereum; this move could bring a ludicrous jump to the price of the second largest cryptocurrency by market capitalization.

However, the Dutch Financial Markets Authority (AFM) has issued a caution concerning the risks of investing in cryptocurrencies and has warned users that they may be subject to market manipulation due to the existing pump-and-dump schemes.