In August, the 2018 bear market (or downtrend) showed some signs of concluding, consolidating and reversing. Fundamentals such as market infrastructure investment, technological progress and regulatory developments have strengthened this year.
However, with regard to asset prices, cautious retail speculation has been a driving force downward along with sudden moves and reversals triggered by large players. Intra-day extreme volatility picked up at the end of the month and has continued into the first week of September. Bitcoin ($BTC) experienced a prolonged consolidation period in later August after the year’s recent higher low of approximately US$6,000 printed on August 13.
Previous lows –
#1 February 5/~US$5,800
#2 June 23/~US$5,750
US$6000 has proven to be very strong support for $BTC and is now an important level of market structure dating back to October 2017. If the US$6,000 level breaks and June lows are retested, the overwhelming market expectation seems to be that $BTC will touch new lows between US$3,000 - US$5,200.
My current bias is 60/40 in favor of the August higher lows and US$6K level holding vs a final short-lived leg down to US$5,200 - US$5,800 in September/October. In August, alt-coins generally traded in lock-step with $BTC, but at a higher beta as is typical.
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