Bitcoin Closes August Bearishly — Eyes Now On $100K Support

Bitcoin begins September under pressure after a brutal August close — now all eyes are on $100K. Bitcoin closed the month of August with a disappointing week for the bulls. After making a new all-time high in mid-August at just over $124,000, bitcoin has put in three red candle closes in a row on the weekly chart. This past week’s candle closed down near the lows, swinging momentum clearly over to the bears. 

The MACD oscillator confirmed a bearish cross on the weekly close as well, which should help maintain downward pressure entering this week. RSI is now sitting in a relatively neutral position just above the 50 line, but at its lowest level since mid-April.

This first week of September will see bitcoin heading down to test the support levels from the May-to-June price consolidation. Bulls will be looking for the high-volume node around $104,000-105,000 to hold price, and ideally prevent this week’s candle from closing below that level. Bears will be trying to push the price down through this support back to the key 1.618 Fibonacci extension level from the 2022 bear market at $102,000. Closing this week in the $102k vicinity or lower would be very bad for the bulls, as it would threaten to break below the infamous laser eyes level of $100,000 and test the last major swing low at $98,000. 

Taking out $100,000 to the downside would give a lot of weight to the “long-term top is in” thesis. $96,000 is basically the last line of defense here for the bulls if price manages to slip through all those upper support levels.

So heading into this week, look for buyers to try to step in and turn things around at the $105,000 level. Bulls will be looking to right the ship this week and put in some sort of reversal candle to turn things around. But for now, the bears are in full control and will look to continue the selling pressure into September.

Terminology Guide:

Bulls/Bullish: Buyers or investors expecting the price to go higher.

Bears/Bearish: Sellers or investors expecting the price to go lower.

Support or support level: A level at which price should hold for the asset,at least initially. The more touches on support, the weaker it gets and the more likely it is to fail to hold the price.

Resistance or resistance level: Opposite of support.  The level which is likely to reject the price, at least initially. The more touches at resistance, the weaker it gets and the more likely it is to fail to hold back the price.

Fibonacci Retracements and Extensions: Ratios based on what is known as the golden ratio, a universal ratio pertaining to growth and decay cycles in nature. The golden ratio is based on the constants Phi (1.618) and phi (0.618).

Oscillators: Technical indicators that vary over time, but typically remain within a band between set levels. Thus, they oscillate between a low level (typically representing oversold conditions) and a high level (typically representing overbought conditions). E.G. Relative Strength Index (RSI) and Moving Average Convergence-Divergence (MACD).

MACD Oscillator: Moving Average Convergence-Divergence is a momentum oscillator that subtracts the difference between 2 moving averages to indicate trend as well as momentum.

RSI Oscillator: The Relative Strength Index is a momentum oscillator that moves between 0 and 100. It measures the speed of the price and changes in the speed of the price movements. When RSI is over 70, it is considered to be overbought. When RSI is below 30, it is considered to be oversold.