Bitcoin Price Action Hinges on Weekend Break or Reclaim of Key Levels
Bitcoin's price action over the past week has been quite volatile, with the cryptocurrency trading near $78,000 heading into the weekend. The sharp rejection from above $81,000 on August 28 has left a gap between $77,000 support and $80,000 resistance.
A break below $77,000 would open up the mid-$75,000s as a potential target, while reclaiming $80,000 could put the roughly $81,300 high from August 28 back in range. This level was briefly reclaimed earlier in the week but turned into resistance after Kevin Warsh's remarks at Jackson Hole lifted September rate-hike odds to around 55%.
On Friday, a major Bitcoin positioning anchor was cleared with the expiry of approximately $6.44 billion worth of options on Deribit. This removal could allow price to move more freely away from $75,000 and $80,000. However, the market still faces macro pressure from the Fed's repricing of rate-hike odds.
The bull case has Bitcoin reclaiming $80,000 and clearing the August 28 high, while the bear case involves losing $77,000 with sustained acceptance below it. The weekend may decide which scenario plays out first, as regulated institutional derivatives can now react directly to a Saturday or Sunday move without waiting for US equity markets to reopen.