Traders discuss future of Bitcoin after sharp 3% drop overnight

Traders discuss future of Bitcoin after sharp 3% drop overnight

Traders are confused after the price of Bitcoin suddenly dropped from $10,950 to $10,630 overnight.

The price of Bitcoin (BTC) fell sharply on September 29 from US$10,950 to US$10,630 overnight, registering a 3% drop. After the rejection of US$ 11,000, the sentiment of traders remains mixed.

Some are cautiously optimistic that BTC will recover to the $10,700 level. Technically, analysts say that the $10,700 area is a key point for Bitcoin in the short term.

Others say that BTC’s price trend has reversed in the short term after its rejection. Bitcoin’s intense reaction to a crucial $11,000 resistance level poses the threat of a further setback.

Cautiously optimistic: what Bitcoin needs to do to recover

According to the trader known by the pseudonym „Byzantine General“, there are three key macro levels for Bitcoin.

The three levels are $10,700, $9,800 and $11,800, with $10.7k representing a short-term hurdle for BTC. The trader said:

„10700 seems to be a key level. 9800 and 11800 are the 2 other important levels closest.

If Bitcoin convincingly recovers the $10,700, it would increase the likelihood of a new $11,800 test in October. A new monthly candle would appear on October 1, and a price spike with the opening of the market could occur.

But if the BTC does not remain above US$10,700, the chances of seeing US$9,800 would increase. This would also make the WEC’s $9,600 gap test highly likely if BTC were to reject $10,700.

The short-term pessimistic scenario

Another Bitcoin trader known by the pseudonym „Benjamin Blunts“ predicts „wild rejection“ causing a major correction.

He said Bitcoin’s recent rejection at US$10,950 reached a critical Fibonacci level. In technical analysis, levels following Fibonacci are considered essential areas for a possible trend reversal.

The trader said a drop below US$10,000, possibly to the support range of US$9,600 to US$9,800, could happen. He said:

„Like clockwork, a 0.78 for the BTC and his wild rejection. expecting a new low below 9.5k from here, however, I’m shorting ETH because I think he’s going to fall further. make no mistake, this is a clear downward trend, back to the stables again. ”

At the top of the pessimistic rejection, on-chain indicators and network activity signal short-term pessimism. Researchers at Santiment said that address activity in Bitcoin’s blockchain is declining.

The decline in fundamentals coupled with intensified market uncertainty could cause high levels of selling pressure. The researchers said:

„Why does the BTC dollar continue to fall whenever we approach $11k? Our DAA Divergence model indicates that the network is seeing a severe lack of address activity. Today is the fifth lowest production in the last 6 months. ”

Typically, on-chain indicators and metrics are medium to long-term signals and often do not accurately represent short-term price trends. Therefore, in the short term, the price of Bitcoin would probably depend on it retarding $11,000 or running the risk of falling to $10,000.

However, other analysts are seeing upward signs. The hash difficulty range indicator, for example, has signalled a „buying zone“ for Bitcoin, which supports the argument for medium-term optimism for the BTC.