Bitcoin (BTC) recently surged to a new all-time high, surpassing $124,000, only to experience a subsequent drop of 9%. This volatility has sparked widespread speculation about the current state of the bull market, the potential for an ongoing “alt season,” and whether Bitcoin has reached its peak.
In light of the current price action, market expert Miles Deutscher has shared insights on the social media platform X (formerly Twitter), suggesting that August may be viewed as a significant trap in the crypto market.
A key factor contributing to this downturn, according to the expert’s analysis, is the diminishing influence of Strategy’s (MicroStrategy) treasury purchases, which previously fueled the cryptocurrency’s last rally.
In his analysis, Deutscher outlines two potential scenarios for the Bitcoin price trajectory. The first possibility involves a dip to the lows around $111,000, which could coincide with Ethereum’s critical support level of $4,000.
The second scenario envisions a reclaiming of the mid-range price of $115,500, which could pave the way for renewed upward momentum.
Interestingly, ETH has recently surpassed BTC in terms of trading volume for treasury companies. Deutscher notes that this trend suggests Ethereum still has considerable room for growth relative to Bitcoin, making it a less saturated trade.
Amid the current market reaction, macroeconomic factors have played a crucial role in price action. Uncertainty surrounding the Federal Reserve’s (Fed) policies, in light of the upcoming Jackson Hole speech, has led to a wave of de-risking among investors.
Deutscher anticipates that this market behavior may lead to a “classic sell into the end of the month” pattern, particularly as September historically presents volatility for Bitcoin.
However, the expert posits that once the uncertainty dissipates, particularly following the Jackson Hole event and the subsequent rate decision next month, the market may be well-positioned for another attempt at new highs.
When writing, BTC trades at $113,000, attempting to consolidate 9% below its all-time high reached on August 14.
Featured image from DALL-E, chart from TradingView.com
