September started with significant losses for the Bitcoin market after the price dropped by 9.16% last week based on data from CoinMarketCap. During this period, the price of the largest cryptocurrency fell below $53,000, reaching a low last seen in early August. Interestingly, despite the low prices of Bitcoin, investors are showing an unusual decrease in buying interest.
Investors refrain from accumulating bitcoins – what could be behind this?
IN X post on Friday, Ali Martinez has noticed that the Accumulation Trend Score (ATS) for Bitcoin is approaching zero. For context, the ATS measures the balance between accumulation and distribution activities in the Bitcoin market. As Martinez explained, a score approaching 0 suggests that BTC investors are either divesting (distributing) or actively buying (accumulating) the major cryptocurrency.
This trend, which indicates a decrease in buying interest, can be interpreted as unusual in the face of the falling price of Bitcoin, which provides an opportunity to accumulate tokens at lower prices using a dollar-cost averaging strategy. A possible reason for this decline in ATS could be that investors are convinced that the BTC market has not yet reached a bottom, which will provide an attractive entry point.
Interestingly, Bitmex co-founder Arthur Hayes predicted that Bitcoin would likely fall below $50,000 this weekend amid its current downtrend. However, Hayes did not provide any specific support level for the crypto asset.
What’s next for bitcoin?
Overall, a bearish start to September for Bitcoin is largely unsurprising after the token’s previous performance, which saw it record an average loss of 4.78% over the past 11 years. With a drop of almost 10% in the first week, it is possible that Bitcoin will experience a total double-digit loss by the end of the month, as it did in 2014 and 2019.
However, the latest data from Non-farm wages shows an raise in US jobs of 142,000, as well as an employment rate of 4.2%. Based on this data, Citi analysts had previously predicted that the US Federal Reserve could cut interest rates by 25 to 50 basis points at its meeting on September 18.
If this prediction turns out to be true, the price of bitcoin could surge in the final weeks of September, leading into October, when, according to historical price data, the cryptocurrency market leader should see double-digit price growth.
At the time of writing, Bitcoin was trading at $53,855, down 4.13% in the past 24 hours. Meanwhile, the asset’s daily trading volume was up 58.82% and is valued at $49.3 billion.
