Bitcoin Leveraged Positions Building Up, But Will This Change The Downtrend?

Bitcoin is firm at spot rates, looking at the development in the daily chart. Even so, the downtrend remains, and price action remains within a bearish breakout formation.

Bitcoin price is showing no signs of slowing down in terms of price decline. Even so, the downtrend remains, and price action remains within a bearish breakout formation. This outlook follows the dump on September 7 that saw the world’s most valuable coin plunge, approaching the all-important round number, $50,000.

Bitcoin price fell sharply on September 7 in a move that saw the world’s most valuable coin come close to breaching the crucial round number, $50,000, before recovering slightly.

The downturn follows a period of relative calm in the cryptocurrency market, with BTC trading within a narrow range for the past few weeks. However, the downtrend has now accelerated, with BTC losing over 10% in the past 24 hours alone.

The sharp decline in Bitcoin price has put pressure on other cryptocurrencies, with the majority of the top 100 coins posting losses in the past 24 hours. Among the few gainers are stablecoins such as USDT and BUSD, which have seen inflows as traders sell off their riskier assets.

The downturn in the cryptocurrency market comes amid a broader sell-off in financial markets, with the Dow Jones Industrial Average and S&P 500 index both posting losses on Monday. The sell-off is being driven by concerns over the Federal Reserve’s plan to raise interest rates, which could slow down the U.S. economy.

However, some analysts believe that the cryptocurrency market could be oversold, and a rebound could be on the cards. If bulls manage to unwind the losses of September 7, we could see a trend reversal. From an effort-versus-result perspective, the trend set in motion by September 7 will shape the short-term, possibly accelerating the fall below August lows.

On the other hand, if BTC price fails to recover, it could lead to further losses in the coming days. In such a scenario, the coin could fall below August lows and set up a bearish price target of $40,000.

As it stands, Bitcoin price is at a critical juncture, and its next move will determine the short-term outlook for the world’s most valuable coin.

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