Sub-$50K Bitcoin Correction Expected as Whales Look to Offload BTC

2 min read | September 09, 2024 02:07 PM AEST | By Team Kalkine Media

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Sub-$50K Bitcoin Correction Expected as Whales Look to Offload BTC — Image source: shutterstock

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Bitcoin may face increased downward pressure as it approaches the September 18 U.S. interest rate decision, with potential for a correction below key psychological levels over the weekend. The cryptocurrency, currently trading around $55,183, could experience significant volatility as market participants react to macroeconomic indicators and trading patterns.

Historical trends show September as a typically bearish month for Bitcoin, and recent activities by major holders of Bitcoin, known as whales, suggest a possible continuation of this trend. One notable transaction involved a whale address offloading 100 BTC, amounting to over $5.3 million, realizing a profit of more than $206,000. Additionally, addresses holding a total of 402,000 {Bitcoin} (BTC) valued at over $21 billion—have been identified as potentially aiming to sell at break-even points.

Arthur Hayes, former CEO of crypto exchange BitMEX, has indicated that Bitcoin could see a correction below the psychological $50,000 mark this weekend. This sentiment aligns with observations from analysts at Bitfinex, who have highlighted the possibility of such a correction before a significant bullish rally.

The recent loss of the $55,000 support level and a 1.4% drop in Bitcoin’s price to $54,340, as of September 7, further underscore the prevailing downward pressure. Bitcoin has also experienced an approximately 8% decline over the past week. In addition, Galaxy Digital’s recent deposit of $78.5 million worth of BTC into Coinbase Prime on September 7 adds to concerns about potential selling pressure in the market.

The upcoming U.S. Federal Reserve interest rate decision may influence market sentiment. A potential rate cut could boost sentiment for risk assets like Bitcoin, though short-term pressures are anticipated before the Fed's decision. The CME FedWatch tool currently indicates a 70% probability of a 25 basis-point rate cut and a 30% chance of a 50 basis-point cut, reflecting market expectations and potential impacts on cryptocurrency pricing.

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