Short-term holders are cutting losses ahead of the FOMC meeting minutes: Will BTC drop to 100,000 USD?

Bulls and bears are vying for control as market sentiment shows signs of balancing, while the price of Bitcoin falls to 113,000 USD. Experts recommend following the potential bearish move towards the support level of 112,000 USD. The release of the FOMC minutes this week may shape the direction of the market. Fed Chair Jerome Powell is likely to maintain a hawkish stance on interest rate cuts this year. Short-term Bitcoin holders cut losses Short-term holders (STHs) of Bitcoin were forced to sell at a loss most recently in January of this year, at the time marking the deepest correction in this cycle. Since then, the cryptocurrency market has largely recovered, with 99% of holders in profit as the price of BTC continues to reach an all-time high (ATH) after surpassing the 100,000 USD threshold. Data from CryptoQuant on August 19 shows that short-term holders are selling at a loss for the first time since the drop in January. Specifically, the STH-SOPR index has fallen below 1, indicating that short-term holders are once again suffering losses.

This signals two possible scenarios for BTC price in the coming months: one is that the bullish momentum may weaken amid large profit-taking, or two is the elimination of weak investors to pave the way for bullish investors. Cash Flow Withdrawn From Bitcoin Spot ETF Funds Bitcoin spot ETFs have seen outflows of up to 121.7 million USD on Monday, indicating a shift in sentiment among institutional investors. BlackRock’s iShares Bitcoin ETF (IBIT) recorded outflows of 68.7 million USD, while the Ark 21Shares Bitcoin ETF (ARKB) saw 65.7 million USD sold off. In contrast, the Bitwise Bitcoin ETF (BITB) recorded inflows of 12.7 million USD. The outflow of funds from spot Bitcoin ETF continues to confirm negative sentiment among investors in the United States. While Coinbase Premium remains positive, the number of investors taking profits has increased by nearly 5.4%, from 1.73 million to 1.83 million BTC. This is the largest increase so far this year (YTD), according to data from Glassnode.

Some investors believe it is time to lock in profits and reduce bullish bets on BTC. Data from Glassnode shows that the number of holders selling at a loss has increased by more than 37.8% in the past 5 days. Investors Await FOMC Minutes Release: Forecast BTC Price Increase Matrixport stated that the Jackson Hole event will not have a significant impact, viewing it mainly as a discussion forum rather than a market-moving factor. The FOMC meeting on September 17 remains the most important factor, with investors paying attention to the release of the FOMC Minutes to look for signals regarding the direction of the cryptocurrency market. As The Coin Republic reported earlier, investors have become cautious after the PPI index of the United States rose by 0.9% in July, bringing the core PPI index up to 3.7%. At the time of writing, the CME FedWatch tool indicates a nearly 83% probability of a 25 basis point cut by the Fed in September. Additionally, traders are now predicting the likelihood of two rate cuts this year instead of three, following the recent hotter PPI index.

Notably, a survey by the founder of the Bitcoin stock-to-flow model, PlanB, indicates a high likelihood that Bitcoin will fall below 100,000 USD. Cryptocurrency analysts, including Rekt Capital, predict a Bitcoin price drop similar to the 29% fall in 2017 and 25% in 2021. However, he predicts that this decline will be shallower and faster in this cycle compared to previous cycles. The price of Bitcoin is trading at 115,629 USD at the time of writing, with a low and high in the past 24 hours of 114,470 USD and 117,050 USD, respectively. Trading volume has fallen by 2.4% in the past 24 hours.