PiCK
Bitcoin Falls Below $79,000 After Breaking $80,000 as Rate-Hike Worries Temper Rally
Summary
- Bitcoin fell below $79,000 after breaking above $80,000, pressured by profit-taking and concerns over a potential U.S. interest-rate increase.
- Markets are focused on the Jackson Hole speech and the September FOMC, while watching whether a break above $82,820 could reopen a path toward $100,000.
- QCP Capital said the recent rally may have been driven by short-position liquidations as open interest declined, while inflows into spot Bitcoin ETFs continued to support spot demand.
Forecast Trend Report by Period
Bitcoin slipped below $79,000 after climbing past $80,000 for the first time since May, as profit-taking combined with renewed worries over higher U.S. interest rates.
CoinDesk reported on Aug. 27 that Bitcoin was trading slightly below $79,000 in Asian trading, down about 1% from a day earlier. As the recent surge cooled, its weekly gain narrowed to 14% from 23% the previous day.
A more hawkish turn in the U.S. rate outlook added pressure. As traders priced in a higher chance of a benchmark rate increase, short-term U.S. Treasury prices fell. That eroded the support from lower rates that had helped Bitcoin rebound quickly from below $68,000 last week.
Focus is now on Federal Reserve Chair Kevin Warsh's Jackson Hole speech scheduled for Aug. 28. Warsh is set to deliver his first keynote address at Jackson Hole since taking office, and markets are looking for clues on the policy path ahead of the Sept. 15-16 Federal Open Market Committee meeting.
Technical signals also point to short-term overheating. Joel Kruger, a market strategist at LMAX Group, said Bitcoin's daily indicators had entered overbought territory. Still, he added that strong overbought conditions do not necessarily lead to a steep price correction.
Kruger identified $82,820, the peak reached in May, as a key level for judging whether the rally can resume. If Bitcoin breaks above that level, the path toward $100,000 could reopen, he said.
Caution remains over the nature of the rebound. Singapore-based digital-asset trading firm QCP Capital said much of the recent advance may have come from the unwinding of existing short positions rather than new buying, citing a decline in open interest. At the same time, it said inflows into spot Bitcoin exchange-traded funds indicate underlying demand in the spot market.
Altcoins were mixed. XRP fell about 3% to $1.41, though it still held a weekly gain of 28%, the strongest among major cryptocurrencies. Solana rose about 4% to above $101 despite the broader market pullback, bringing its weekly gain to 19%. Ether traded at about $2,494, up roughly 1%.
Suehyeon Lee
shlee@bloomingbit.ioI'm reporter Suehyeon Lee, your Web3 Moderator.