Bitcoin (BTC) extended volatility into the Sept. 8 Wall Street open as a classic “short squeeze” sparked new September highs.
Bitcoin offers a round trip to $24,400
Bitcoin had seen upside momentum the day prior, culminating in a trip above $26,400 after the daily close.
A subsequent comedown nonetheless took BTC/USD full circle, and the pair was back under the $26,000 mark at the time of writing.
Welp — lets take out the lows again then eh? pic.twitter.com/EVeXRnuwJ6
— Jelle (@CryptoJelleNL) September 8, 2023
The result was punishment for late traders chasing the market up and down. According to data from monitoring resource CoinGlass, short liquidations totaled $23.5 million for Sept. 7, with the Sept. 8 long tally not yet known.
“Shorts got hunted as expected,” popular trader Skew wrote in part of overnight market coverage on X (formerly Twitter).
$BTC Binance & Bybit Open Interest
Shorts got hunted as expected
note the OI added here with small price reaction and decreasing perp bid delta, this implies more shorts scaling into price on this second drive higher https://t.co/OULNlQrQof pic.twitter.com/X1hNlvjbdc
— Skew Δ (@52kskew) September 7, 2023
Fellow trader Daan Crypto Trades highlighted the significance of reclaiming lost ground from August.
“Bitcoin Was finally able to break above the September monthly open after testing it numerous times. It is now retesting it,” he told X subscribers on the day.
“The question is, will it provide as much support as it did resistance? Up to the bulls to try and maintain a ‘green’ September.”
CoinGlass data confirms that September tends to produce a BTC price downside of close to 10%, with market expectations skewed appropriately for 2023.
Analyst: BTC price cementing “final correction”
Continuing, trader Crypto Tony dismissed the strength of the overnight move, advising that $26,600 was the line in the sand to cross.
“Nice rally off the $25,600 range low, but no follow through up to the range highs, so again we are stuck mid range,” he explained alongside an explanatory chart.
“No entry for me on Bitcoin unless we clear $26,600.”
After returning to familiar territory from the first week of September, BTC/USD nonetheless continued to preserve the 200-day exponential moving average (EMA), currently at $25,674.
Commenting on Bitcoin’s interaction with the 200-week EMA in previous cycles, Michaël van de Poppe, founder and CEO of trading firm Eight, ventured that the market was in the midst of the “final” BTC price drop this time around.
“Technically speaking, we can solely focus on the price action in 2019, but that doesn’t grant a clear case. The case in 2015 (given the new participants joining this cycle into the markets -> institutions), we can correlate the current market with that cycle,” part of commentary stated.
“In that regard, this is the final correction.”
There’s a level which #Bitcoin must hold in order to avoid a significant crash.
Bitcoin is currently holding onto a significant level of support. It’s around the $25,500 barrier.
In the meantime, we’re facing a month of destruction. September. What’s next for Bitcoin? … pic.twitter.com/nNI8GmxKuN
— Michaël van de Poppe (@CryptoMichNL) September 7, 2023
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