Bitcoin (BTC) recently concluded its third-worst week of the year, witnessing a notable decline exceeding 5%. With the end of Week 38 marking the closure of the third quarter, Bitcoin’s performance has been relatively flat, accumulating a mere 1% rise for the quarter, while September has managed to hold steady.
This pattern aligns with historical trends that position this period as one of the weakest stretches in the cryptocurrency market. However, several factors may have influenced this recent downturn.
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On Friday, the cryptocurrency market experienced a pivotal moment as over $17 billion in options expired. The max pain price—essentially the strike price at which option holders bear the most losses while option writers come out ahead—settled at $110,000, creating a gravitational pull for the spot price.
A significant technical aspect to consider is the short-term holder cost basis, which stands at $110,775. This figure signifies the average on-chain acquisition price for Bitcoin that has changed hands within the last six months. Bitcoin touched this threshold during the August market fluctuations, and in bullish trends, it typically gravitates towards this benchmark several times. Interestingly, this year, it has only traded significantly below this level on one occasion—during the tariff-induced sell-off in April, which saw prices plunge to approximately $74,500.
Taking a broader perspective is crucial to discern whether Bitcoin is maintaining an uptrend characterized by higher highs and higher lows, which is essential in evaluating the sustainability of any price rally.
Market analyst Caleb Franzen has pointed out that Bitcoin has fallen below its 100-day exponential moving average (EMA). The 200-day EMA is currently positioned at $106,186, and the previous notable low was approximately $107,252 on September 1. To maintain an upward trajectory, Bitcoin must remain above this critical level.
In parallel, recent U.S. economic data indicates robust growth, with the economy expanding at an annualized rate of 3.8% during the second quarter—surpassing expectations of 3.3% and marking the strongest quarter since early 2023. Initial jobless claims have also declined by 14,000, now at 218,000, the lowest since mid-July. Furthermore, the core PCE price index, a key measure of inflation favored by the Federal Reserve, rose by 0.2% in August compared to the previous month.
The yield on 10-year U.S. Treasuries has rebounded off the support level of 4% and is now trading around 4.2%. The dollar index (DXY) lingers near long-term support at 98. In commodities, silver has been on an impressive run, reaching around $45—approaching historic highs not seen since 1980 and 2011. Meanwhile, U.S. equities are trailing just shy of record highs.
Against this backdrop, Bitcoin remains an outlier, currently over 10% below its peak, raising questions about its future momentum in the evolving financial landscape.
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