Bitcoin, the leading cryptocurrency in the market, has recently attempted to stabilize around $112,000 after a sharp drop to $110,000 on Sunday, which represents a 10% decrease from its all-time high (ATH).
Before the September meeting of the Federal Reserve (Fed), market expert Doctor Profit highlighted on X (formerly Twitter) the upcoming impacts and the most important technical indicators painting a bleak picture for Bitcoin (BTC) and the market in general.
Will the Fed's Rate Cuts Trigger a New Market Correction?
Doctor Profit emphasizes that the current market environment is distinctly different from previous cycles. He believes that the Fed's expected interest rate cuts next month could trigger a strong correction for both stocks and cryptocurrencies.
According to him, the first significant cut usually brings about instability, leading to mixed opinions among investors, and he predicts this time will be no exception.
Looking at the technical indicators of Bitcoin, the outlook seems pessimistic. Experts note that the Chicago Mercantile Exchange (CME) has a significant gap around the $93,000 mark that needs to be addressed, with most liquidity concentrated in the $90,000 to $95,000 range.
The chart indicates the potential for a correction, highlighted by a double top pattern and declining trading volume. Notably, Doctor Profit asserts that the latest price surge taking BTC to $124,000 was primarily due to futures market activity rather than the spot market, reinforcing the pessimistic sentiment.
Bitcoin Price Forecast
Market sentiment plays a crucial role in this analysis. On-chain metrics and sentiment indicators show that retail investors tend to buy high and sell low.
The expert revealed that in the latest Bitcoin price drop from $110,000 to $98,000 around May to June this year, mainly institutional investors took advantage of the lower prices, while retail buyers suffered losses.
Doctor Profit added that as prices rise, retail investors have entered the market at higher prices, which could lead to liquidations as Bitcoin approaches the critical liquidation zone from $90,000 to $95,000.
Alongside the price action of Bitcoin, Doctor Profit warns that the current market sentiment reflects a false sense of optimism, suggesting that the widespread belief in a sustainable altcoin season is misguided. He warns that as enthusiasm increases, larger investors may begin to liquidate positions, putting retail investors at risk.
Looking ahead, he predicts that the price of Bitcoin could soar to $145,000 to $150,000, which is a 34% increase from the current level. This expert also expects Ethereum to reach between $7,000 and $8,000 after the correction in September.
At the time of writing, Bitcoin is trading at $112,560, recording a 6% decrease over the fourteen-day timeframe. On the other hand, Ethereum consistently ranks among the best-performing coins in the market with a 5% increase over the same period.
