Three Factors That Could Propel Bitcoin to $68K in September

August 23, 2024 04:37 PM AEST | By Team Kalkine Media

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Three Factors That Could Propel Bitcoin to $68K in September — Image source: shutterstock

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Bitcoin's recent technical setup and on-chain data suggest the possibility of a short-term recovery. Following a significant low on August 5, Bitcoin’s price has rebounded by over 22%. Analysts are observing technical and on-chain indicators that could signal the continuation of this recovery.

Declining Exchange Supply

A key indicator of Bitcoin’s rally is the decrease in Bitcoin supply on exchanges. This decline suggests that traders are choosing to hold Bitcoin rather than liquidating it for other assets or fiat. On August 23, centralized exchanges held approximately 2.68 million Bitcoin BTC, marking an 11% reduction from January 1. This reduction occurs alongside a 43% year-to-date increase in Bitcoin’s value. Despite this, data from CryptoQuant indicates a decrease in inflows into spot Bitcoin ETFs, which are now a fraction of March's levels. CryptoQuant analysts highlight that a rebound in spot ETF purchases is crucial for driving up overall Bitcoin demand and possibly triggering a price increase.

Whale Accumulation

Another positive sign is the accumulation of Bitcoin by large holders. Data from Santiment shows that Bitcoin addresses holding between 100 and 1,000 BTC have accumulated approximately 94,700 additional BTC over the past six weeks. This accumulation, amid price fluctuations, suggests that significant stakeholders are positioning for gains. Since the low on July 5, Bitcoin’s market valuation has risen by 13%, indicating that large holders view the current price as an opportunity for future appreciation.

Bull Pennant Formation

Technically, Bitcoin’s price has formed a bull pennant pattern, a continuation pattern that typically follows a strong upward move and resolves with an upward breakout. Bitcoin is currently trading above the pennant's upper trendline near $60,300. If this resistance holds, the price could potentially move towards a range of approximately $68,000, reflecting a 12.4% increase from current levels.

Additionally, Bitcoin’s rise above $61,800 on August 22 has caused the 200-day exponential moving average (EMA) to act as support. The EMA, situated between $58,653 and $60,465, indicates a significant demand zone where nearly 919,470 BTC were acquired by around 1.77 million addresses. Increased activity within this zone could further support Bitcoin’s upward trajectory in the coming weeks.

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