When Bitcoin prices fall below the $110,000 support level, two dangerous chart patterns are formed while Exchange-Traded Fund (ETF) spills are rising.
summary
- Bitcoin prices formed a head and shoulder pattern.
- BTC also forms a wedge pattern that rises to the weekly chart.
- The inflow of Bitcoin ETFs has been slower for two consecutive weeks.
Bitcoin prices recede amid weakness in ETFs
In the last check on Saturday, September 27th, Bitcoin (BTC) was trading for around $109,600. This is a 12% drop from an all-time high. It has also hovered at its lowest level since September 2nd.
This week, BTC and other cryptocurrencies were pulled back as demand from American investors eased. Data compiled by SoSovalue shows that ETF inflows have slowed over the past two weeks.
All Bitcoin ETFs experienced a $902 million outflow this week, after adding $886 million earlier this week. They said $2.34 billion in the week of September 12th.
One potential reason for the weakness is that some Federal Reserve officials have warned about interest rate cuts. Officials like Austan Goolsbee, Beth Hammack and Raphael Bostic warned that the Fed should be careful when cutting interest rates.
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These staff noted that inflation has exceeded the 2% target for over four years. They also pointed out that the labor market is still strong, citing the low unemployment rate.
The economy is also resilient, with a recent report showing a 3.8% expansion in the second quarter. The number of Americans filing for unemployment claims has dropped significantly over the past few weeks.
Going forward, the next important catalyst for Bitcoin and other coins is non-farm pay data on Friday. These numbers will help the Fed decide whether to cut interest rates at its October meeting.
BTC price formed head and shoulder pattern
BTC Price Chart | Source: crypto.news
Daily time frame charts show that Bitcoin prices have been rebounded over the past few weeks. A closer look reveals that it slowly formed a head and shoulder pattern.
Additionally, although it is below the 50-day index moving average, the relative strength index is heading downwards. These patterns suggest the possibility of further downsides at a 50% Fibonacci retracement level of $100,000.
BTC formed a divergence of rising wedges and bearishes
Bitcoin Chart | Source: crypto.news
The weekly chart shows that Bitcoin prices have formed an upward wedge chart pattern featuring two converging trendlines, which are rising. These two lines are approaching confluence, indicating a potential bearish breakout.
At the same time, oscillators such as relative strength index and MACD formed bearish divergence patterns as they continued to rise and moved downwards. These two patterns show even more downsides in the coming weeks.
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