BTC Price Analysis: Bitcoin’s Struggle at $26k Support – Will it Slip Below $25k Before Reaching $30k?

The world’s largest cryptocurrency Bitcoin (BTC) has been struggling to stay afloat at $26,000 and continues to face selling pressure amid weakening technical indicators. As of press time, Bitcoin is trading at $25,972 with a market cap of $505 billion.

Clear indicators on the four-hour chart suggest an imminent breakout in BTC price. The tightening Bollinger bands signal an impending breakout, often observed before significant price movements.

However, concerns persist that the potential breakout might initially lean bearish, causing the BTC price to decline under $25,000 before resuming its upward trajectory beyond $30,000.

Courtesy: Trading View

Should BTC price breach the lower limit of the Bollinger band, a downward shift may occur, jeopardizing short-term support and increasing pressure on the subsequent buyer concentration at $25,000.

A sustained drop below the critical $25,000 level could elevate the likelihood of losses extending to $23,500. This range is expected to attract traders seeking exposure to BTC, with anticipation for a robust upward move past $30,000.

Nonetheless, the possibility of extended declines to $20,000 remains open, especially as market observers are already anticipating an additional rate hike from the United States Federal Reserve. Federal Reserve Chair Jerome Powell’s recent speech hinted at the necessity for another round of rate increases.

The regulator’s assertive approach to monetary policy hinges on several economic indicators, including metrics like the Consumer Price Index (CPI), which indicated in August that inflation remains a concern.

If another rate hike occurs in September, Bitcoin could encounter difficulty maintaining its position above $25,000, significantly raising the likelihood of another downturn to $23,500, and potentially even to $20,000 in more extreme circumstances.

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Bitcoin Price Can Correct Another 40%

According to the PoW Floor pricing model, there is potential for the BTC price to decrease by an additional 40 percent to levels below $15,000, as highlighted by well-known cryptocurrency journalist Ali Martinez. Following historical trends, this could signify the conclusion of the bearish phase. However, it’s important to note that the BTC price might not necessarily reach the $14,800 level, given the robust support present at $20,900.

Bitcoin’s volatility is currently in check, with investors in a wait-and-see mode for the SEC’s decision regarding the spot Bitcoin ETF. This shall come most likely by early September. As the week progresses, greater clarity is expected to emerge about the potential direction of the BTC price moving forward.

Recent on-chain data reveals a notable decline in Bitcoin’s transaction volume, reaching its lowest point in three years. Data sourced from Santiment indicates this encompasses ious factors such as peer-to-peer payments, miner fees, exchange fees, and withdrawals.

Courtesy: Santiment

Any favorable economic data release ahead this week could bring back optimism to Wall Street and thus to the crypto market.

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