Bitcoin exhibited significant volatility leading into the Wall Street open on September 8th, driven by what is commonly referred to as a “short squeeze,” resulting in new highs for September.
BTC’s price fluctuations led to the liquidation of both short and long positions. After a surge that took Bitcoin above $26,400 following the previous day’s upward momentum, the cryptocurrency retraced its steps and fell back below the $26,000 mark at the time of reporting.
#Bitcoin doing exactly what I wanted to see — holding above the range highs.
— Jelle (@CryptoJelleNL) September 8, 2023
Late Traders Face Consequences
Late traders who chased the market experienced losses as a result of these rapid price shifts. Short liquidations amounted to $23.5 million on September 7th, while the long liquidation total for September 8th was yet to be determined.
$BTC Binance & Bybit Open Interest
Shorts got hunted as expected
note the OI added here with small price reaction and decreasing perp bid delta, this implies more shorts scaling into price on this second drive higher https://t.co/OULNlQrQof pic.twitter.com/X1hNlvjbdc
— Skew Δ (@52kskew) September 7, 2023
Market analyst Skew noted that shorts were “hunted as expected.” He highlighted that Bitcoin had managed to break above the September monthly open after multiple tests, and its ability to hold above this level would be crucial for maintaining a positive trajectory in September.
Historical Price Trends in September
Data from CoinGlass indicated that September historically tends to witness a nearly 10% downside correction in Bitcoin’s price, aligning with market expectations for 2023.
Trader Crypto Tony emphasized the significance of the $26,600 price level as a key threshold to cross for further positive momentum. He observed that while there was a rally from the $25,600 range low, it lacked the follow-through required to reach the range highs.
Bitcoin’s Technical Analysis
BTC/USD continued to hover around the 200-day exponential moving average (EMA), currently positioned at $25,674. Analyst Michaël van de Poppe suggested that the market might be experiencing the “final” price correction in this cycle, comparing it to past cycles and highlighting the significance of the 200-week EMA.
There's a level which #Bitcoin must hold in order to avoid a significant crash.
Bitcoin is currently holding onto a significant level of support. It's around the $25,500 barrier.
In the meantime, we're facing a month of destruction. September. What's next for Bitcoin? 👇… pic.twitter.com/nNI8GmxKuN
— Michaël van de Poppe (@CryptoMichNL) September 7, 2023
Bitcoin’s recent price action has been marked by volatility, driven by a short squeeze, with traders experiencing both gains and losses. The cryptocurrency market is closely watching key price levels for signals of future direction, while historical trends suggest a potential downside correction in September.