Bitcoin (btc) begins the new week with optimism as traders greet the first green weekly candle in more than a month.
BTC price strength appears to be gradually improving after a weak August and early September, with the BTC/USD pair rising towards $27,000.
A strong weekly close provides the backdrop for what promises to be an interesting few days, including a key US macroeconomic event as a possible driver of volatility.
The US Federal Reserve will meet to decide on interest rate policy and any surprise could have major repercussions for risk assets, including cryptocurrencies.
Elsewhere, things look promising for Bitcoin, with the network's fundamentals set to hit new records.
The strength “under the hood” is similarly reflected in hodler behavior, with wallet numbers continuing to skyrocket higher regardless of BTC price action.
Cointelegraph discusses these topics and more as Bitcoin begins what is likely its most anticipated September week.
Trader observes BTC price "local bottom"
bitcoin offered little volatility over the weekend, but calmer trading conditions are already being challenged in the new week, according to data from Markets Cointelegraph Pro and TradingView sample.
The weekly close on September 17 soon gave way to bullish volatility, and at the time of writing, the bulls are attempting to build on that base to reach new highs so far this month.
Popular trader Credible Crypto suggested that the weekend zone could well form a “local bottom.”
“This region continues to be defended and buyers intervene here once again. Are the ingredients of a local fund/base forming in my opinion? said X (formerly Twitter) subscribers overnight, along with a liquidity graph of the order book on the largest global exchange, Binance.
"I think we'll be back up to 27,000+ soon."
A previous post noted lack of promise in short positions at weekend levels, with improved liquidity of offers.
Meanwhile, the weekly close enthused Michaël van de Poppe, founder and CEO of trading firm Eight, who saw key support at the 200-week exponential moving average (EMA).
“Bitcoin is closing above the 200-week EMA, which is vital for bullish continuation,” he said. explained.
"Next week we should continue doing this and the price will start to look like the 2015/2016 cycle."
Van de Poppe uploaded a chart showing the interaction between the spot price and the 200-week EMA, currently at $25,700, since 2020.
“Markets are consolidating with a weekly close well above the 200-week EMA for Bitcoin. The chances of the correction being completed are increasing day by day,” he stated. aggregate in a separate post.
Some remain sober about Bitcoin's prospects through 2024. Among them is popular trader and analyst Rekt Capital, who continues to watch for the possibility of a bearish double top pattern developing on weekly time frames.
“Make no mistake: Bitcoin is in an early stage of the bull market,” he said. wrote in part of the analysis of weekend X.
“In the long term, the outlook is bullish. Medium term? Over the next 7 months, we may or may not get one last major correction. Will it happen? “It would be wise to at least be prepared for it if that were the case.”
FOMC Volatility Due to 99% Rate Pause Odds
This week, what is on everyone's lips is the FOMC (the Federal Open Market Committee), which will meet to decide on future interest rates.
If history is any guide, the September 20 decision will induce at least some form of volatility in risk assets, with Bitcoin and cryptocurrencies being no exception.
The picture surrounding the latest FOMC meeting is mixed: last week's macroeconomic data shows inflation exceeding expectationsHowever, markets overwhelmingly believe that the Federal Reserve will not raise rates further to combat it.
According According to CME Group's FedWatch tool, the odds of rates remaining unchanged are nearly unanimous.
This could reduce the impact of the FOMC event, but conversely, a curve decision that goes against market valuations would be felt more acutely.
“This week sets out the rest of 2023,” financial commentary resource The Kobeissi Letter summarized, while highlighting upcoming macroeconomic data releases and more.
“Wednesday's Fed guidance sets the tone for upcoming meetings. Expect to see a lot of volatility this week.”
This week's key events:
1. Building permit data - Tuesday
2. Data on housing starts - Tuesday
3. Fed interest rate decision: Wednesday
4. Federal Reserve Press Conference - Wednesday
5. Unemployment claims - Thursday
6. Existing Home Sales Data: Thursday
This week sets out the rest of 2023.
— Kobeissi's letter (@KobeissiLetter) September 17, 2023
Explaining the likely outcome of the FOMC, macro and crypto information resource Ecoinometrics suggested that the market probabilities were not a surprise based on the Fed's signals.
"There will be no rate hike at the FOMC meeting on September 20. That's what fed funds futures are pricing in," he says. wrote on the weekend.
“And they've actually been very consistent about it for a long time. “The fact that the latest inflation figures aren’t exactly going in the right direction didn’t change anything.”
An accompanying chart adds that the market "never had any doubts" about what would happen in September.
Difficulty, hash rate returns to new records
Next week will be back to Bitcoin and the fundamental “up only” style of growth is expected to characterize the coming week.
Mining difficulty, which fell 2.65% in its last automated reset two weeks ago, will offset its losses on September 19.
The last Dear All from BTC.com suggest that the difficulty will increase by a solid 4.6%, taking it to new all-time highs in the process.
In 2023, a broad uptrend in difficulty was only briefly challenged, even as spot price action led to more challenging conditions.
The story is the same for the hash rate (the estimated processing power deployed by miners) which continues to set new records.
A notable rise in the new week has become a talking point in its own right and optimism among commentators has increased as a result.
Who is responsible for the hashrate increasing by almost 20%? Who do you think?
This is surreal.#btc #Bitcoin pic.twitter.com/paIwb57DNm
- Bitcoin Bootcamp (@BTCbootcamp) September 17, 2023
“The bitcoin network hashrate is at an all-time high,” said Nicholas Cary, co-founder of Bitcoin data resource Blockchain.com, noted earlier this month.
"What does this mean? Difficulty is a measure of how difficult it is to mine a Bitcoin block, or in more technical terms, find a hash below a given target. A high difficulty means that more computing power will be needed to “mine the same number of blocks, which will make the network more secure against attacks.”
Blockchain.com My dear hash rate of 422 exahashes per second (EH/s) as of September 17, while BTC.com currently puts the figure at 430 EH/s.
Number of Bitcoin addresses hits multi-year highs
Just as there is no stopping Bitcoin miners, the user base also seems to be expanding endlessly.
The number of new BTC wallets being created is now at its highest level since late 2017, the time Bitcoin hit an all-time high of $20,000, data from on-chain analytics firm Glassnode shows.
According to the company's address tracking metric, not even the subsequent trip to $69,000 managed to provoke such a big reaction in the creation of new addresses.
Active addresses, however, mimic mid-2021 and return to those levels for the first time this month.
The data was uploaded to X by Andre Dragosch, head of research at cryptocurrency investment firm Deutsche Digital Assets. Dragosch asked if BTC price performance would copy the performance in Glassnode metrics.
“All-time high in addresses with 0.01 Bitcoin or less,” James Straten, research and data analyst at crypto information firm CryptoSlate, aggregate about more Glassnode data.
“The fifth strongest accumulation of this cohort in the last five years. “This asset continues to be cornered by a small cohort.”
Fear of cryptocurrencies is never far away
While things may be improving across the Bitcoin ecosystem, the average crypto investor has yet to regain their confidence.
Related: Bitcoin Price All-Time High Will Precede Halving in 2024: New Prediction
According According to the latest data from the Crypto Fear & Greed Index, the mood that characterizes cryptocurrencies remains one of "fear."
The extent of the fears is modest: the index, which normalizes sentiment on a scale of 0 to 100, is now just below its “neutral” mark of 50.
However, fear has dominated since mid-August, with price triggers being a key influencing factor.
Meanwhile, analyzing net unrealized profit and loss data among BTC supply, popular trader and analyst Titan of Crypto revealed what he called a “striking correlation” between this year’s environment and that seen in the previous period. to previous Bitcoin bull runs.
“I think we could witness similar price action to what Bitcoin had in the first 2 cycles,” he predicted part of his commentary.
#Bitcoin Surprising Correlation Between Net Unrealized Gains and Losses
- In 2012, 2016, when NUPL was contracting between the Optimism/Anxiety and Hope/Fear areas, the BTC price was consolidating before resuming its rise.
- In 2019, when NUPL was skyrocketing, the price of Bitcoin rose without... pic.twitter.com/110OMhdGcW- Cryptocurrency titan (@Washigorira) September 17, 2023
This article does not contain investment advice or recommendations. Every investment and trading move involves risks, and readers should conduct their own research when making a decision.
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