As September began, Bitcoin’s price dipped below $26,000, erasing any remnants of the “Grayscale hype” that had briefly boosted the cryptocurrency. The market witnessed further declines following the Wall Street opening on September 1st, continuing the losses from the August monthly close.
August Losses and Lack of Optimism
August proved challenging for Bitcoin, as it lost 11.2% of its value, leaving little room for optimism among market observers for a September rebound. Traders and analysts were skeptical about Bitcoin’s prospects in the near term.
In a YouTube update, trader and analyst Rekt Capital pointed out that Bitcoin’s price failed to sustain the gains generated by the “Grayscale hype.” He noted that selling pressure was strong, and the weekly Relative Strength Index (RSI) was approaching a crucial rising trendline. Additionally, previously supportive Exponential Moving Averages (EMAs) were now turning into resistance.
Potential Targets for Further Decline
Rekt Capital outlined potential price targets for Bitcoin’s further decline, with $23,000 being a favored level among traders. Historical data from on-chain monitoring resource CoinGlass suggested that losses of “between 7% and 13%” in September could be expected based on past norms. However, he also mentioned the possibility of a relief rally that could reach as high as $27,200, a level that previously acted as support.
U.S. Dollar Strength Compounds Bitcoin’s Woes
Bitcoin’s performance was further impacted by the strengthening U.S. dollar, which marked its second consecutive day of gains. The U.S. dollar index (DXY) was above 104 at the time of reporting, signaling a continued uptrend that began in mid-July. Market participants remained divided on the extent to which DXY strength influenced Bitcoin’s price, as the inverse correlation between the two assets had been challenged repeatedly over the past year.
The cryptocurrency market faces a challenging start to September, with Bitcoin encountering resistance and a lack of bullish sentiment. As traders monitor key technical indicators like the RSI and EMAs, the crypto community awaits signs of a potential recovery or further downside in the coming weeks.