September: A ray of hope, or a plunge into the abyss?The wild swings of August have finally come to an end, and for cryptocurrency investors, it's been a grueling month. Following the correction in early August, the market has been in constant flux, leaving investors exhausted
September: A ray of hope, or a plunge into the abyss?
The wild swings of August have finally come to an end, and for cryptocurrency investors, it's been a grueling month. Following the correction in early August, the market has been in constant flux, leaving investors exhausted. If the first five months of the year tested investors' patience, August challenged their confidence in the crypto space. It's been six months since Bitcoin last broke its previous high, and during this period, market volatility seems to have drained many investors' funds.
Currently, a sense of pessimism hangs over the market. Many believe a significant drop is imminent, and that only after this plunge will the bull market begin. However, there are conflicting opinions about where the drop will end and what the exact bottom will be. Everyone is eagerly awaiting interest rate cuts and the arrival of a bull market, but without a substantial correction, a bull run might be difficult to achieve.
Why does the market need to be purged? It's like a game. If everyone is bullish and buying, can the market continue to rise? Everyone makes a fortune; where does all this profit come from? The logic of the market is that there must be enough short sellers to drive the price up, because the profits of the longs come from the losses of the shorts.
Is September Bitcoin's (BTC) last chance to get on board?
Everything will eventually turn around. It's important to have faith that the current downturn is simply the brief darkness before dawn. All the hardships we've endured will pave the way for future surprises. Mountains have peaks, lakes have shores, and in the long journey of life, there's a turning point for everything.
The weekend saw the market continue to decline. Retail investors remain bearish and spread FUD (fear, uncertainty, and doubt), but whales are continuously buying, unabated. Bitcoin, after consolidating at a high, continued to decline over the weekend, and the subsequent pessimistic sentiment quickly spread. The Fear & Greed Index dropped to 26, a significant decline from last week's 55. This emotional shift arises from concerns about liquidity. After the ICO and VC phases, people started embracing the PVP-mode meme. When the meme fails, pessimism intensifies.
On the macro level, people fear an American recession; on the micro level, they worry about a lack of innovation in the industry, hindering sustained growth. While panic spreads, a look at on-chain data reveals that whales aren't selling, but rather, continuing to buy. Often, when the market is gripped by fear, opportunities emerge.
Be patient.
This current purge is only a temporary fluctuation, and spot holders should prioritize patience, unconcerned with short-term price fluctuations. Even if BTC's recent movements cause anxiety, often, when this sentiment prevails, a significant rally is just around the corner.
Bitcoin's next key level to watch on the daily chart is the 120-day moving average. If it can reclaim the $64,000 level, then a major rally is likely on the horizon. Until then, it can be understood as a period of consolidation and adjustment. The key factor is whether the spot market decides to re-enter or attempt another targeted short-squeeze. Until then, widespread pessimism in the market is not unreasonable.
Don't follow the crowd when most people are looking in the same direction, but also don't simply do the opposite because everyone is looking in the same direction. During periods of transition between trending and ranging markets, it's often the easiest time to lose money. If you don't understand, don't trade. Not trading means no losses, and not losing is winning.
I still stand by my statement that I am optimistic about the fourth quarter. Even now, I don't see any reason for sustained pessimism. So, hold onto your chips and maintain a positive attitude.
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