Bitcoin price (BTCUSD) price is under siege. The price is up by about 0.72% in the past 24 hours and is down by about 0.25% in the past seven days. After reaching a year-to-date high of $12,487 in August, it has dropped to the current $11,686. In all, the BTCUSD pair has gained by about 5% in August and underperformed Ethereum, whose price is up by more than 25%.
Bitcoin under pressure
Bitcoin price has been under pressure this month. Indeed, it has underperformed Ethereum and even the S&P 500 and Nasdaq 100, which have gained by 8% and 12%, respectively. This underperformance is probably because of lack of major news in August.
In fact, the only major news was that MicroStrategy, a $1.2 billion firm had decided to shift a substantial amount of its cash to Bitcoin. Another major news was that Fidelity was launching a new Bitcoin fund for wealthy clients. That was affirmation that Bitcoin is going mainstream.
Bitcoin has been under pressure at a time when things look positive for the sector. For one, the Fed has committed to low interest rates for longer. Lower interest rates tend to lead to asset bubbles or appreciation, which is a positive thing for Bitcoin prices. At the same time, the bank has been expanding its balance sheet in a bid to cushion the American economy.
Meanwhile, the US national debt has continued to soar. According to the national debt clock, the debt has jumped to more than $26 trillion, which is a substantial amount considering that it was less than $10 trillion ten years ago. And there are chances that this debt will increase if congress passes another stimulus package.
So, will Bitcoin price continue rising or continue moving sideways?
Bitcoin Price technical outlook
Bitcoin price is trading at $11,686, which is lower than this year’s high of $12,485. On the daily chart, the price remains above the 50-day and 100-day exponential moving averages. Bitcoin is also forming a head and shoulders pattern, with the neckline at about $11,000 level. Also, its volatility, as measured by the Average True Range (ATR) has started to drop.
There are two scenarios for the price of Bitcoin in September. First, and most probably, the price is likely to continue rising as bulls aim for the next resistance level at $12,485. If it does this, it will lead to the possibility of the crypto rallying to $13,000. On the flip side, the price may drop below the neckline of the head and shoulders level at $11,000.