Bitcoin stalls around $20K: All Eyes on Europe’s Energy Crisis and plunging Euro

• In Control as Bitcoin (BTC) Struggles to Regain Control Above $20K in Second Week of September
• Global macroeconomic forces are still in play; focus on Europe
• Bitcoin’s move northward is dampened by negative sentiment combined with risk appetite in the near term

The Bitcoin (BTC) price showed a lack of volatility in the market on Monday after taming the bulls’ defensive efforts to hold the $20,000 support over the weekend. The coin continued to track sideways movement after the weekend and remained below this level yesterday. The loss of support around the psychological $20K mark potentially sets the price of the leading cryptocurrency up for a turbulent ride in a week full of macroeconomic influence.

Here’s what to look out for as you head into week two of the month with a striking history of general cons.

Macroeconomic factors should continue to play despite the lack of direction in the crypto markets

Bitcoin has hovered between $19,700 and $20,100 for the past three days, leading other altcoins to trade around a tight range. Macro BTC signals suggest that the Satoshi coin may be looking to print its lowest price yet, which will come in the form of a retest of the June low around $17,700. It is marked that more external forces, more skyrocketing inflation , has weighed on prices for most of the year.

This week, Europe’s energy woes and the recent decline in the euro against the US dollar are the key events to watch as they act to limit extraction and a pullback in crypto prices. The US macro picture is expected to come into focus next week on September 13, when the Federal Reserve publishes consumer price index (CPI) figures for August.

On Monday, the euro, which has eroded since the start of the year, fell to a twenty-year low against the US dollar.

The slump is not the only cause for concern, with analysts predicting more losses are still favored as a rebound remains an elusive goal. It must also be noted that most stock markets are not doing any better, and their correlation with crypto assets is preventing a breakout north.

Bitcoin (BTC) holders are accumulating, research says this could be a positive

The majority of Bitcoin holders have become resistant, as evidenced by recent on-chain data, which indicates that even BTC last bought a dozen months ago is barely seeing any movement. Blockchain Insights platform Glassnode recently reported local records in the stationary BTC supply – a trend that analysts claim could trigger a parabolic Bitcoin run.

In a research newsletter, ‘Ebbing HODL Waves Signal Bitcoin Bottoms,’ researcher Joe Consorti observed that “dormant supply peaks are stepping stones” upward momentum. Co-author Nik Bhatia opined in the same post that Bitcoin could be poised for a price rally if a significant portion remains dormant.

“If two-thirds of bitcoin is out of the market for an extremely long period, the price is driven up as more buyers enter the market and bid on a limited supply — a scenario that has played out in bitcoin twice before.”

While the correlation between dormant BTC supply and price movement is not entirely clear-cut, Bhatia advised that the current trend is worth tracking. On the underlying cause, the researcher concluded that there is no root cause.

“Is this causation [coins being illiquid and new market entrants bidding up for a lower amount of available coins] or circumstance [a proxy of the reflexivity between market drawdowns making for unfavorable selling prices]? We do not know,” Bhatia noted“But when data moves in reverse-tandem in previous cycles, it grabs attention and demands attention“

BTC Signals Bottom As Sentiment Revisits “Extreme Fear”

The current Bitcoin price action could be setting up a bottom as far as on-chain calculations show. The MVRV ratio in particular suggests that the leading cryptocurrency is looking to hit a bottom, given its extended trading range below the 200-week moving average price.

Last week, popular market analyst Michaël van de Poppe highlighted the test of the 200-week MA as one of the indicators that will define the Bitcoin (BTC) price course. Meanwhile, the Crypto Fear & Greed Index has moved further into the “Extreme Fear” zone after its weekend drop to 22 points barely three weeks after reaching a multi-month high of 47.

To learn more, visit our Investing in Bitcoin guide.