The Bitcoin Index Value for August, which accounts for its average price across leading global exchanges, amounted to $11,643, according to data from Statista.
Bitcoin has however started the month of September with huge retracements despite analysts’ speculation that this would boost Bitcoin’s price, the opposite has been experienced across all major exchanges.
For the last five days, Bitcoin has tested levels well below $11k, support levels with major selloffs causing the coin to lose over 15% of its value. At the time of writing, Bitcoin is down 2.11% in the last 24 hours, trading at $10,245.
Gemini’s crypto brokerage Tyler Winklevoss has termed this dip above the $10K resistance level as the new baseline for Bitcoin’s price, which means Bitcoin is gearing up for a breakout.
“Remember when a Bitcoin dip was well below 10k? Now bitcoin dips are comfortably above 10K, new baseline. Bitcoin is consolidating before its next breakout. “
Bitcoin Most Likely To Fill Current CME Gap before a Breakout
Several crypto traders and analysts are predicting that Bitcoin will dip further and will most likely fill the current CME gap before a retracement to higher resistance levels above $11K.
Crypto analyst Josh Rager wrote on Twitter:
“BTC CME Futures closed at $10,620, so any price action weekend seems like it will be lower than the closing price.”
As one of the most important technical analysis tools that Bitcoin traders use to predict BTC’s price movement, the CME futures gap indicates changes between the close and open price of an asset, including Bitcoin.
An unfilled gap usually occurs when price moves sharply in either direction when there is little trading activity in the market or when the market is stuffed.
When Bitcoin has a price gap, traders maintain higher prices which will eventually drop back to fill the gap sooner or later, with a 95% chance of that actually happening.
What Happens If Bitcoin Loses $10k As A Support Level?
Contrary to Winklevoss’s opinion, the current bitcoin price movement seems highly likely to fall below the $10k ‘baseline.’ A different perspective by crypto trader ‘Crypto Michael’ analyzed that if bitcoin falls below $10K, the open CME gaps between $9600 and $9900 will likely be filled, with the lower $9600 looking more probable.
Weekend trading activity will also likely create a new CME gap and cause a short term price relief. The closing of the gap will mean a new bottom for Bitcoin, meaning that $10k as resistance will be held as well as higher levels.