Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
Bitcoin’s price plunged to a 17-day low of approximately $112,300 on Wednesday, marking its lowest point since August 3, as analysts increasingly suggest the price action is influenced by orchestrated selling pressure within the U.S. market. The decline occurred during the Wall Street open, with bulls struggling to counteract an ongoing sell-off, leading to concerns among market observers regarding potential manipulation.
Market Dynamics and Liquidity Concerns
Data from Cointelegraph Markets Pro and TradingView indicated that BTC/USD fell below the $113,000 mark after a brief reclaim following the daily open. According to CoinGlass data, bid liquidity was actively being consumed on exchanges, drawing attention to the new support level around $112,300.
Popular trader Daan Crypto Trades noted on X that Bitcoin has been taking out liquidity on both sides over the past six weeks, ranging within the same price region. He highlighted that the largest cluster of liquidity currently sits near $120,000, while the local range low at $112,000 remains a critical level, often acting as a reversal zone or price magnet.
Allegations of Price Manipulation
Keith Alan, co-founder of trading resource Material Indicators, suggested that the appearance of increased bid liquidity further down the order book, including a “plunge protection” level at $105,000, could indicate a form of price manipulation. Alan referred to entities he has previously dubbed “Spoofy the Whale” and the “Notorious B.I.D.,” which he claims have artificially influenced Bitcoin’s price action in recent months.
Alan concluded that while it is “too soon to make any assumptions,” the impact on price direction would be similar, stating, “Bids moving lower invites price to move lower.”
Implications for Altcoins and Historical Context
The Kingfisher, a prominent market commentator, warned that a continued “bleed” in Bitcoin’s price could have significant repercussions for altcoins. While altcoins currently show a balanced skew, he cautioned that a gradual decline in Bitcoin could lead to cascading block-by-block drops, potentially triggering 10-30% declines in altcoins even with a modest 5% Bitcoin move.
However, popular trader and analyst Rekt Capital offered a more optimistic perspective, drawing parallels between the current price action and previous bull-market corrections. He pointed out on X that similar retracements occurred at the same point in the cycle during both 2017 and 2021, and in both instances, these pullbacks preceded rallies to new All-Time Highs.
Upcoming Macroeconomic Influences
Looking ahead, trading firm QCP Capital highlighted the significance of the upcoming minutes from the U.S. Federal Reserve’s July Federal Open Market Committee (FOMC) meeting. Attention is also focused on Federal Reserve Chair Jerome Powell’s speech on Friday at the Fed’s annual Jackson Hole economic symposium.
QCP Capital noted in its “Asia Color” update that the stakes are high for Powell, as he will be setting the path for monetary policy while markets balance easing inflation against rising labor risks. Markets are currently pricing an 80-95% probability of a 25-basis-point interest rate cut at the September 17 FOMC meeting, though incoming data could quickly shift these expectations.
