Traders are increasingly betting on a deeper dive to June’s lows or even beyond, with $20,000 struggling to hold.
Bitcoin (BTC) looked set to equal its lowest monthly close since 2020 on Aug. 28 as bulls failed to take control.
Odds stack up for a deeper dive below $20,00
The pair had been unable to make up for lost ground over the weekend, and just days from the end of the month, even $20,000 appeared vulnerable as support.
At the time of writing, Bitcoin traded near $19,900 — below June’s closing price.
“It didn’t matter what kind of lines or squiggles you had on your charts,” on-chain monitoring resource Material Indicators summarized over the weekend alongside bid and ask data from the Binance order book.
“After JPow punched the market in the face on Friday, BTC lost the trend coming off the June low. Now the question is whether that local low holds. Currently not seeing enough bid liquidity to get excited.”
Material Indicators was referring to the Aug. 26 risk asset cascade which resulted from hawkish comments by Jerome Powell, Chair of the United States Federal Reserve.
With no sign of a desire to curtail or reverse key rate hikes in future, Powell’s speech at the annual Jackson Hole economic symposium sent shockwaves through equities markets. U.S. stocks lost a combined $1.25 trillion on the day.
Bitcoin suffered in step, and while some potential buyers came forward with plans to buy below $20,000, consensus favored deeper downside going forward.
Popular trader Anbessa was eyeing two scenarios on the day, one involving a support/ resistance flip to continue higher and another targeting a breakdown to $16,000-$17,000.
“We need to see a lot before this becomes bullish,” fellow trader Crypto Tony added in part of his latest update.
BTC supply held at a loss nears 50%
For analytics account On-Chain College, meanwhile, a sign of encouragement came from on-chain data covering hodler profitability.
The latest price drop decreased the proportion of the BTC supply in profit, and that proportion was now approaching levels only seen in previous macro market bottoms.
“I’ve been waiting all bear market for the Bitcoin Percent of Supply in Profit to drop below 50%,” On-Chain College commented.
“In June, it bounced just above at 50.28%. Currently, it’s at 51.76%. This metric dropped below 50% in every prior bear market + March 2020.”
As Cointelegraph reported at the weekend, hodlers continue to cold-store the BTC supply with increasing conviction.
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