Bitcoin Price Faces $3.2 Billion Sell-Off as Traders Turn to LTC, XMR

Bitcoin Price Analysis:

Bitcoin’s price continues to hover below the $60,000 mark on September 3, struggling to overcome the critical resistance level. Recent on-chain data reveals that retail traders are reallocating capital towards altcoins, adding bearish pressure to BTC’s price action this week.

Bitcoin Price Consolidates Below $60,000

On August 25, the global cryptocurrency markets witnessed a sharp downturn, resulting in Bitcoin price dropping by over 10% from its 20-day peak of $64,998 within a turbulent 48-hour period. Since then, BTC has repeatedly failed to reclaim the $60,000 level.

Market analysts are closely watching the upcoming FOMC meeting on September 17, where the US Fed is expected to announce its first rate cuts in four years.

The anticipation of these cuts appears to be driving retail crypto traders to exit their BTC positions in favor of the more volatile altcoin markets, contributing to the downward pressure on Bitcoin’s price.

The chart above indicates that BTC rejected the $66,000 resistance on August 5 after rallying 15.8% in the previous 10 trading days. However, the failure to break above $66,000 triggered a large-scale sell-off among short-term traders.

As of September 3, BTC is trading around the $59,000 mark, down 9.40% over the past nine days. Meanwile the likes of Litecoin (LTC) and Monero (XMR) have raced into double-digit gains during the same period.

With the FOMC meeting just weeks away, the anticipation of potential rate cuts could exert additional selling pressure on BTC in the near term.

As the onset of a bull phase looms, traders may offload BTC to capitalize on larger gains in the altcoins market. It Bull traders take a sit-and-watch approach as observed this week, BTC price could struggle to maintain steady support base above the $60,000 area.

Bitcoin Faces $2.2B Sell Wall

The bearish sentiment surrounding BTC is further supported by current on-chain data. This week, crypto exchanges have seen a spike in BTC sell orders, reinforcing the downtrend narrative.

The Aggregate Exchange Order Books chart is a crucial tool for identifying demand and supply dynamics in real-time. It offers insight into market depth by comparing the total buy and sell orders across exchanges.

As depicted in the chart, there is currently an oversupply of BTC in the market compared to demand. The total active buy orders stand at 49.82k BTC, valued at approximately $2.9 billion, while active sell orders amount to 53.7k BTC, equivalent to about $3.2 billion.

The $300 million excess supply indicates a bearish outlook for BTC’s short-term price prospects. The presence of this $2.2 billion sell wall could stymie any upward momentum for Bitcoin, particularly as market participants await the FOMC meeting on September 17. This cautious approach may further weaken BTC’s chances of breaking through key resistance levels.

BTC Price Forecast: Failure to Clear $62,800 Could Heighten Downward Pressure

Based on the technical indicators, BTC’s price forecast remains bearish in the near term. The Bollinger Bands suggest increasing volatility, with the price currently trading below the middle band, indicating resistance around $62,800. This level will be crucial for bulls to reclaim if they hope to reverse the current downtrend.

If BTC fails to break above $62,800, the next support level lies at $55,874, as indicated by the lower Bollinger Band. A breach of this support could see BTC testing even lower levels, potentially towards $53,000.

The Accumulation/Distribution Line (ADL) shows a downward trend, further validating the bearish outlook. This suggests that selling pressure continues to outweigh buying interest, increasing the likelihood of further declines.

In summary, BTC faces significant resistance at $62,800. Failure to clear this level could heighten downward pressure, with support at $55,874 likely to be tested in the coming days. With the FOMC meeting on the horizon, traders may remain cautious, potentially exacerbating the bearish trend.