The price of Bitcoin (BTC) is fluctuating inside a narrow trading range for several days, and Aug. 2 is no different.
Why is Bitcoin price stuck?
Bitcoin price fell nearly 1% to around $29,500 on the day. Still, the downside move was part of a flat market trend that started a week ago, wherein the price has been trading inside the $28,850–$29,660 range.
The sideways trend follows Bitcoin’s 4% drop below $30,000 last week, primarily due to the Federal Reserve’s interest rate hike. Rate increases have historically been bearish for non-yielding cryptocurrencies like Bitcoin.
Nonetheless, Wall Street economists anticipate a rate hike pause at the next Fed meeting in September, which may be limiting Bitcoin’s downside below $29,000.
On the flip side, BTC is struggling to stay above $30,000 — a psychological resistance level — due to broader market risks, including regulatory uncertainty around Binance, the world’s largest crypto exchange by volume, and a recent decentralized finance exploit costing $47 million.
The ongoing bias conflict in the Bitcoin market has coincided with depleting institutional interest. According to CoinShares’ weekly report, investors withdrew about $19.4 million from Bitcoin-based investment funds in the week ending July 28.
“93% of the outflows were from long-Bitcoin investment products, while short-Bitcoin saw its 14th consecutive week of outflows totaling $3.1 million,” wrote James Butterfill, investment strategist at CoinShares, adding:
“This suggests investors have been taking profits in recent weeks, with the sentiment for the asset overall remaining supportive.”
Bitcoin price outlook for August
From a technical standpoint, Bitcoin is currently holding above its 50-day exponential moving average (50-day EMA; the red wave) while eyeing a close above $30,000, its immediate resistance level.
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If the price breaks above $30,000, BTC’s likelihood of rallying toward $31,500, a local peak level, is high for the month of August.
The upside target seems valid as long as BTC trades above its multimonth ascending trendline support. Nonetheless, breaking decisively below the 50-day EMA and the ascending trendline risks crashing Bitcoin toward its 200-day EMA (the blue wave) near $27,000.
This level served as support during the March–April session earlier this year.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.