Bitcoin (BTC) recently appeared poised for significant positive momentum and has undergone a notable price correction. After a two-month high of $66,500 last Friday, the cryptocurrency fell approximately 6% last week to around $60,000 on Thursday.
Top Buy Zones for Bitcoin
The predicted uptrend for Bitcoin was initially fueled by softening economic conditions, particularly following the US Federal Reserve decision. decision to cut interest rates on September 18th.
However, the escalation geopolitical tensions in the Middle East altered investor sentiment, leading many to seek refuge in traditional safe-haven assets such as gold.
Furthermore, concerns regarding the macroeconomic scenario intensified, especially after Fed President Jerome Powell suggested the possibility of further rate cuts of 0.50% in the coming months.
This confluence of factors led to a wide market settlementwith Bitcoin, Ethereum and the market’s leading cryptocurrencies facing substantial liquidity outflows estimated at nearly $300 million, as reflected in the total cryptocurrency market capitalization.
Despite the recent decline, crypto analyst VirtualBacon has provided further insight optimistic outlook on social media, noting that Bitcoin has returned to the “Bull Market Support Band.”
The analyst highlights that this support band has historically provided a cushion during corrections between current market prices and the $62,500 mark on the weekly time frame.
VirtualBacon emphasized that a weekly close above $58,000 could indicate a healthy correction, setting the stage for a resurgence. On the other hand, a break below this threshold would require reevaluation of bullish strategies.
The analyst pointed out two main buy zones: $62,500 and a lower range between $58,800 and $60,000. These zones coincide with previous highs and align with the 200-day exponential moving average (EMA), a significant long-term support level for any bull market.
The 200-day EMA, currently around the $60,000 mark, has been key over the past six months. It acted as support and resistance during various phases of Bitcoin’s price movements in March, May and July of this year.
September jobs report approaches
In its analysis, VirtualBacon explained that if Bitcoin recovered from $60,000, it would signal strength in the market. However, a daily close below $58,000 – or a weekly close below that level – could signal a potential downtrend reversal.
VirtualBacon has outlined a strategy to capitalize on the current slump, indicating a willingness to accumulate Bitcoin in the $58,000 to $60,000 range, which he sees as a high-risk, high-reward zone. However, he warned that a close below $57,000 would be a significant red flag.
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For the analyst, as long as Bitcoin remains above US$58,000, there is potential for a higher low, preparing the ground for a new price peak above US$66,000. However, macroeconomic factors will continue to be crucial in defining market sentiment.
Launching this week in September jobs report will be particularly significant as it will provide insights into the current unemployment rate, which could influence future Bitcoin price movements, according to the analyst:
- 4.2%: Very optimistic for the market.
- 4.3%: Neutral outlook.
- 4.4%: Caution is recommended.
- 4.5% and above: Bearish implications.
At the last meeting of the Federal Open Market Committee (FOMC), Jerome Powell identified 4.4% as a critical threshold. If the unemployment rate rises above this level, VirtualBacon believes this could signal problems for the broader economic scenario.
Featured image of DALL-E, chart from TradingView.com