Crypto Price Analysis 9/4: BTC, ETH, SOL, FTM, TAO, TIA

Major Cryptocurrencies Plummet Amid Stock Market Decline

Major cryptocurrencies experienced significant losses after major US stock indexes closed substantially lower on Tuesday. The downturn was primarily led by Nvidia (NVDA) and other chipmaker stocks, marking a weaker-than-expected start to September following a strong finish to August.

As a result, the crypto markets also saw a sharp decline, with major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Polkadot (DOT), and others recording substantial drops.

• Bitcoin (BTC): Dropped almost 5% in the last 24 hours.
• Ethereum (ETH): Fell by nearly 6%, plunging below the critical $2,400 level.
• Solana (SOL): Also dropped close to 6%, falling below $130.
• Polkadot (DOT): Barely hanging on to the $4 mark.

Bitcoin (BTC) Loses Traction

Bitcoin (BTC) fell to a low of $55,676 before climbing back above $56,000 as the crypto markets tumbled in response to declines in the traditional stock markets. The world’s largest cryptocurrency has lost significant ground, dropping nearly 5% in the past 24 hours, and may struggle to regain the $60,000 level. Traders have attributed this drop to broader macroeconomic conditions, but other factors are also at play.

One trader pointed out that concerns about a potential recession in the US have impacted BTC. However, with the current trend stabilizing and attention shifting to monetary policy and the US Dollar’s performance, BTC’s bullish outlook will depend on expectations of a looser Federal Reserve policy, such as lowering interest rates. This scenario suggests that traders expect the US to implement expansionary measures to stimulate the economy.

“The bottom of #Bitcoin may be in. There’s a new bullish narrative for Bitcoin driven by looser Federal Reserve policy and global macro trends. After a bearish phase in early August, expectations of the Fed easing monetary policy, such as lowering interest rates, have boosted optimism for #Bitcoin. This shift in sentiment marks a ‘tactical bottom’ for Bitcoin, potentially signaling the start of a new bull run. $BTC is now less influenced by US recession concerns and more by monetary policy and the US dollar’s performance.”

The upcoming US jobs report, scheduled for September 6, could also have a significant impact. Economists from Morgan Stanley expect the US to have added 185,000 new jobs in August, a figure sufficient to support a 0.25% rate cut. However, skepticism among traditional investors persists, which became apparent when Nvidia, despite reporting earnings that exceeded market expectations, saw its stock drop by 6% in the following trading session.

Spot Bitcoin ETF Outflows and Declining Miner Profitability

Another factor contributing to BTC’s lagging price and prevailing pessimism is the significant outflows observed in spot Bitcoin ETFs. These instruments have not only failed to attract inflows but have also seen considerable outflows, drawing negative attention. Between August 27 and August 30, spot Bitcoin ETFs recorded $480 million in net outflows, wiping out the $455 million in inflows from the two days prior. While this may be considered a typical occurrence, it could create doubt among traders regarding BTC’s future price trajectory.

Bitcoin investors are also worried about miner profitability, which is near all-time lows, potentially triggering a selloff. Currently, miners hold over 1.8 million BTC, a figure that has remained unchanged for the past few months, raising concerns among investors. Compounding this issue is the recent drop in Bitcoin’s hashrate index, which has fallen from $48 per PH to $42 per PH per day.

Breakout or Breakdown for Bitcoin (BTC)?

The question on every investor’s mind is whether Bitcoin (BTC) is heading for a breakout or a breakdown. Analysts have identified three major events that could potentially drive BTC’s price higher and possibly reverse its downward trend of the past few months. According to Mena Theodorou, co-founder of Coinstash, the next significant price action for BTC will depend on how the market reacts to upcoming political and regulatory shifts in the US, along with forthcoming macroeconomic data.

Theodorou remarked:

“Whether it’s a breakout or a dip will likely depend on the next major piece of news or market shift […] for now, the market seems to be in a bit of a ‘wait and see’ mode.”

Federal Reserve Meeting: A Potential Catalyst

Josh Gilbert, market analyst at eToro, is particularly focused on the upcoming Federal Open Market Committee (FOMC) meeting scheduled for September 18. He believes this event could serve as a major catalyst for BTC. Most analysts anticipate that Federal Reserve Chair Jerome Powell will announce an interest rate cut of up to 0.525%, which could significantly boost risk assets like Bitcoin.

“The bottom line is that a rate cut is coming, but the focus is now on the size of that cut. US jobs data this week will be a key driver of the expectation and could see a move in crypto assets,” Gilbert noted.

Upcoming US Employment Data: A Double-Edged Sword

Ting Wang, CEO of Coinstash, emphasized the importance of the upcoming US employment data, which is expected to be released on Friday. The July unemployment rate came in higher than expected, raising concerns about a potential recession.

Wang explained:

“The unemployment rate is famously known as a double-edged sword. On one hand, a higher-than-expected rate could signal a greater chance of recession, which isn’t great news. On the other hand, it could actually be positive for the market because it might give the Fed more reason to cut interest rates.”

Investors will need to keep a close eye on these developments, as they could significantly impact the direction of Bitcoin’s price in the coming weeks.

Bitcoin (BTC) Price Analysis

Bitcoin (BTC) experienced a significant downturn early in the session, dropping to a low of $55,663 before buyers managed to push the price back above $56,000. However, with markets generally in the red, BTC faces intense selling pressure and may struggle to reclaim previous support levels unless a significant trigger boosts its price. As observed in the price chart, BTC has mostly been in decline since the weekend.

• On Friday, sellers attempted to drag the price below $58,000, reaching a day low of $57,733. However, buyers countered the selling pressure and pushed BTC back above $59,000.
• BTC saw a marginal drop on Saturday, followed by a nearly 3% decline on Sunday, ending the weekend at $57,399.
• On Monday, BTC rebounded with a 3% increase, settling at $59,169. However, on Tuesday, strong selling pressure prevented a move above the 20-day SMA and the $60,000 price level, leading to a 2.77% drop to $57,529.

Currently, BTC is trading around $56,500, down nearly 2%. Bears are likely to continue their dominance, potentially driving BTC below the $55,000 support level. On the other hand, buyers will aim to reclaim the $57,000 level before attempting further moves. A break above $60,000 and $65,000 is crucial for a sentiment reversal, signaling that bulls are regaining control. If BTC clears these levels, it will face resistance between $70,000 and $74,000.

Ethereum (ETH) Price Analysis

Ethereum (ETH) has dipped below the $2,400 mark and could face a significant downturn if it closes below $2,300. ETH has struggled throughout August, plagued by bearish sentiment, and this trend has continued into September.

• ETH traded between $2,400 and $2,600 but failed to break above the 20-day SMA. Over the weekend, ETH dropped 3.44% to settle at $2,428.
• On Monday, ETH rebounded by 4.55%, rising above $2,500 to settle at $2,529. However, on Tuesday, sellers regained control, driving ETH down by 4.49% to $2,425.
• During the ongoing session, ETH dropped to a low of $2,310 but has since rebounded to $2,389 as it attempts to reclaim the crucial $2,400 level.

If ETH closes below $2,300, it could decline further to $2,200 or even $2,100. Therefore, it’s crucial for buyers to reclaim the $2,400 level. However, the sentiment around ETH remains bearish, with the MACD currently bearish and the RSI trading below the neutral 50 level.

Solana (SOL) Price Analysis

Solana (SOL) is attempting to reclaim the $130 price level after falling below it on Tuesday as sellers continue to exert pressure on the asset’s price. SOL has been in a bearish trend, dropping over 13% in the past week.

• In late August, SOL dipped below $140 and settled at $135. The start of September saw SOL drop just over 5% to settle at $128.
• Despite the bearish sentiment, SOL started the current week with a 4.98% increase, pushing back above $130 to settle at $135. However, sellers once again exerted pressure, causing SOL to dip by 5.47% on Tuesday to $127.
• During the ongoing session, SOL dropped to a low of $122 before buyers pushed it back above $130, with the cryptocurrency currently trading at $131, up almost 3%.

SOL has strong demand at the $120 price level, which buyers are expected to defend to prevent further downturns. For sentiment to flip, SOL must close above $130, setting it up for a push toward $140. A successful break above this zone could lead to a move towards $150.

Fantom (FTM) Price Analysis

Fantom (FTM) ended August on a bearish note, slipping below the 50-day SMA after failing to stay above $0.50. Buyers attempted a recovery after FTM dipped to $0.42 on August 28 but couldn’t build momentum.

• FTM dropped nearly 5% on Sunday, slipping below $0.40, but rebounded by 6% on Monday, returning to $0.42.
• On Tuesday, FTM dropped almost 9% as intense selling pressure continued.

FTM’s RSI is just under 50, close to neutral but indicating a bearish inclination. However, sentiment around FTM could change as the Fantom network gears up for the launch of the Sonic testnet next week, promising significant improvements in speed and scalability along with new features.

Bittensor (TAO) Price Analysis

Bittensor (TAO) has plummeted almost 8% over the past 24 hours and 18% over the past week as top AI tokens faced a crippling decline. This decline is partly attributed to chip giant Nvidia registering a sharp decline on September 4, with its stock plummeting by almost 10%, leading to a $270 billion loss in market capitalization.

• Following the news, tokens such as AKT, FET, RNDR, and TAO saw double-digit declines before recovering some losses.
• TAO dropped almost 6% at the start of the month, dragging its price down to $264. However, it rebounded by over 6% on Monday to settle at $280.
• On Tuesday, TAO dropped over 11%, slipping below $250 and settling at $248. During the current session, TAO dropped to a low of $240 but has since recovered to $255, up by almost 3%.

Celestia (TIA) Price Analysis

Celestia (TIA) is struggling to stay above its support level as a lack of buying activity continues to stall momentum for bulls. TIA has been in a downward trend since failing to push above $6.05 on August 24, losing several key support levels as its price plummeted.

• By the end of August, TIA had slipped below $5, trading at $4.49, marking a nearly 20% drop for the month.
• The new month saw bearish sentiment persist, with TIA dropping almost 6% on Sunday to settle at $4.24.
• TIA rebounded on Monday, rising by 5.71% to settle at $4.47. However, on Tuesday, it dropped over 9% to $4.06 before recovering slightly to $4.19.

TIA has strong support at $4, which could prevent further decline. Buyers must reclaim the $4.50 level to reverse sentiment and push towards $5, where a downward-sloping 20-day SMA acts as resistance.