Bitcoin has had a rough start to September after a brutal August close, leaving investors on edge as all eyes are now focused on the $100,000 support level. The cryptocurrency closed out August with three consecutive red candle closes on the weekly chart, signaling a shift in momentum to the bears after reaching a new all-time high of over $124,000 in mid-August.
The MACD oscillator also confirmed a bearish cross on the weekly close, adding to the downward pressure heading into September. The RSI, sitting just above the 50 line, is at its lowest level since mid-April, indicating a neutral stance but with potential for further downside.
As the first week of September unfolds, Bitcoin is expected to test support levels from the May-to-June price consolidation period. Bulls will be looking for the high-volume node around $104,000-105,000 to hold price and prevent a close below that level. However, bears will be aiming to push the price down to the key 1.618 Fibonacci extension level from the 2022 bear market at $102,000. A close below $102,000 could threaten to break below the critical $100,000 level and test the last major swing low at $98,000.
If Bitcoin breaks below $100,000, it could lend credibility to the theory that a long-term top has been reached. The $96,000 level will be the last line of defense for the bulls if the price continues to slide.
Investors will be closely watching the $105,000 level this week, hoping for a reversal in the current bearish trend. While the bulls will be looking to regain control and push for a positive turnaround, the bears are currently in the driver’s seat and will likely continue to apply selling pressure in the coming days.
Understanding key terminology such as bulls, bears, support and resistance levels, Fibonacci retracements and extensions, as well as oscillators like RSI and MACD, will be crucial for navigating the volatile cryptocurrency market. Keeping a close eye on these indicators and market trends will help investors make informed decisions in the ever-changing landscape of Bitcoin trading.