Bitcoin (BTC) is headed for a long-term support retest, data suggests, after BTC price action fell into the August monthly close.
BTC price: Roads point to $23,000
Market participants had seen cause for bullishness into the close, with Bitcoin holding a key long-term trendline and preserving $27,000.
A decision by the United States Securities and Exchange Commission (SEC) to delay a slew of Bitcoin spot price exchange-traded fund (ETF) applications forced a rethink, with Bitcoin shedding $1,000 over just two hourly candles.
Now, observers are concerned that even current levels may fail to hold the market up for long.
“On-chain data suggests that $BTC lacks strong support below the $25,400 mark,” popular trader Ali told X (formerly Twitter) subscribers.
“If BTC breaks below this threshold, it could swiftly correct down to $23,340.”
Ali uploaded a chart of the UTXO realized price distribution (URPD) metric from on-chain analytics firm Glassnode.
This tracks the price at which the current set of transaction outputs was created and functions as a roadmap for likely price support and resistance levels.
A breakdown to $23,000 would not come as a surprise to some, with that target already on the radar for various traders and analysts.
Bitcoin inches toward key support battleground
Continuing, on-chain monitoring resource Material Indicators delivered a similarly grim picture for BTC/USD on daily (D), weekly (W) and even monthly (M) timeframes.
Using signals from one of its proprietary trading tools, Trend Precognition, Material Indicators advised that $24,750 needed to hold for bulls to have a chance at clinching a rebound.
“If price moves and holds below $25,350 the W signal will invalidate, however, if support holds above the LL at $24,750 there will be a good foundation to rally from and retest resistance,” part of X commentary explained.
“We will look to the Monthly candle open for a signal from the Trend Precognition algos to gain insight to whether we can expect an extension of the downtrend or a monthly momentum shift to the upside.”
Data from CoinGlass meanwhile showed Aug. 31 sparking the largest volume of BTC long liquidations since Bitcoin’s 10% dive earlier in the month.
These came in at $41 million, with the cross-crypto total at $108 million — still far below the daily tally from two weeks prior.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.