(Kitco News) – Asset prices spent much of Thursday playing catch-up after Wednesday’s Big Tech-led flush out and a strong GDP report exerted pressure on stocks, gold, silver, and cryptos in early trading.
Despite the stronger-than-expected GDP report, weakness from U.S. consumers has buoyed hopes that the Federal Reserve will initiate the first interest rate cut in September, providing some relief for struggling markets.
At the closing bell, stocks were mixed, with the Dow finishing up 0.20%, while the S&P and Nasdaq lost 0.51% and 0.93%, respectively. At the time of writing, gold is down 2.33% on the session and trading at $2,359.30, while silver lost 4.74% and trades at $27.93.
Data provided by TradingView shows that Bitcoin (BTC) fell below support at $65,500 in the early hours of Thursday, hitting a low of $63,420 in the afternoon before dip buyers pushed it back above $64,500.
BTC/USD Chart by TradingView
At the time of writing, Bitcoin trades at $65,475, a decrease of 0.40% on the 24-hour chart.
BTC retests key support levels
“Bitcoin is testing today the 1D MA50 (blue trend-line) for the first time since July 19, on the most important 'break-and-pullback' re-test since October 11, 2023,” said market analyst TradingShot. “That was the last time BTC re-tested the 1D MA50 as a Support after a recent break-out, following the April 14, 2023 - September 11, 2023, Bearish Leg of the 21-month Channel Up that started back at the bottom of the last Bear Cycle in November 2022.”
“Despite marginally breaking below it on the re-test, it managed to sustain candle closings above it and that kickstarted the October 2023 - March 2024 rally,” he said. “As a result, we expect a similar rally to start if the same closing conditions hold, which will technically be the Channel's new Bullish Leg that may finally hit the $100k psychological benchmark.”
“It has to be said also, that next week's Fed Rate Decision or at least a hint towards the September meeting will undoubtedly have a huge impact on it,” TradingShot said.
Market analyst SatochiTrader also sees the current weakness as temporary, and thinks Bitcoin will start heading higher once the latest round of FUD clears.
“BTC has a high volume of DCA (Dollar Cost Averaging) whales who will do everything in their power to protect the price action,” he said. “The strategy is to hold BTC during an active cycle. News about AI, Trump, China, and miners may impact the market momentarily, but not permanently.”
He added that the outlook for Bitcoin remains “positive and can increase with time to 74K.”
“As long BTC holds 62K with confirmation, it means cycle whales are still behind it for this cycle,” SatochiTrader concluded. “[This is a] personal view, you should only trade/invest depending on your plan and risk management.”
TradingView user The_ForexX_Mindset urged traders to remain calm despite the recent sell-off as technical data suggests Bitcoin will soon head higher.
“No panic, TA is so clear on what’s next,” he said. “Many traders are in panic mode by selling. Once this is over, the general rule returns back to normal. Those who own ALTS, prices will move back up. Many sold for fear. Greed will return.”
And market analyst Rekt Capital said, “Bitcoin is now in the process of retesting the $65,000 level in a volatile manner.”
“Needs to now Daily Close above $65k (blue) to render the retest as successful and keep price in the $65k-$71.5k region (red),” he said.
No escape for altcoin traders
It was a rough day for altcoin traders as only one token in the top 200 recorded a notable gain, with Galxe (GAL) climbing 15.4% to trade at $3.55.
Daily cryptocurrency market performance. Source: Coin360
The remainder of the field plunged into the red, led by a 19% loss for BinaryX (BNX), a 15.2% decline for Blast (BLAST), and a 14.2% loss for ether.fi (ETHFI).
The overall cryptocurrency market cap now stands at $2.3 trillion, and Bitcoin’s dominance rate is 55.4%.
