Sub $50K Bitcoin correction remains in play as whales look to sell BTC

A Bitcoin correction below the $50,000 psychological mark could occur as soon as this weekend, threatening to create more downward pressure in the historically bearish month of September.

Bitcoin (BTC) price could see more downside pressure this weekend as whales, or large BTC holding entities, are looking to lock in profits.

Notably, a savvy whale address sold 100 BTC worth over $5.3 million to lock in over $206,000 worth of profit. 

Following suit, a total of 402,000 BTC worth over $21 billion was bought by addresses that are likely looking to sell at break even, according to a Sept. 7 X post by onchain intelligence firm Lookonchain, which wrote:

“836,000 addresses bought ~402,800 $BTC ($21B) at a price between $51,113 and $54,303. These addresses are likely to sell near the breakeven.”

Whales, or large crypto-holding entities, can have a significant impact on a cryptocurrency’s price action due to the high amount of market-moving capital. Traders often follow whale selling patterns for cues on a cryptocurrency’s short-term price trajectory.

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Bitcoin could correct below $50,000: Arthur Hayes

Bitcoin could see a correction below the key $50,000 psychological mark as soon as this weekend, warned Arthur Hayes, former CEO of crypto exchange BitMEX, 

Hayes wrote in a Sept. 6 X post:

“BTC is heavy, I’m gunning for sub $50k this weekend. I took a cheeky short. Pray for my soul, for I am a degen.”

Meanwhile, Bitcoin price lost the key $55,000 support, falling 1.4% to trade at $54,340 in the 24 hours leading up to 9:26 am UTC, Sept. 7. The world’s first cryptocurrency is down nearly 8% on the weekly chart.

Bitfinex analysts have also warned of a potential correction below $50,000 before the real bull rally. The analysts told Cointelegraph:

“This is not an arbitrary number, but based on the fact that the cycle peak in terms of percentage return reduces by around 60%–70% each cycle, and the average bull market correction has reduced as well.”

Adding to investor concerns about more incoming selling pressure, Galaxy Digital also deposited $78.5 million worth of BTC to Coinbase Prime on Sept. 7, noted Lookonchain.

Related: Total crypto market sinks below $2T as analysts eye Bitcoin reversal below $54K

Bitcoin to see more downward pressure leading up to interest rate cut

A potential interest rate cut in the world’s largest economy, the US, could bolster investor sentiment for risk-on assets like Bitcoin.

However, Bitcoin price will likely see more downside pressure leading up to the Sept. 18 interest rate decision, according to Alvin Kan, chief operating officer of Bitget Wallet. Kan told Cointelegraph:

“We expect BTC and the equity markets to face downward pressure leading up to the Fed’s official rate cut announcement. Once the rate cut is confirmed after the September FOMC meeting, we may see a short- to mid-term boost in risk assets.”

Whale and institutional buying activity will have a significant effect on short-term Bitcoin prices. Kan added:

“Given the current market volatility, there’s a possibility of BTC experiencing liquidity issues, which could cause sharp, temporary price drops. At the moment, there’s about a 40% chance of BTC dipping below $50,000.”

Investors are increasingly expecting an interest rate cut from the US Federal Reserve at its upcoming meeting on Sept. 18.

According to the latest data from the CME FedWatch tool, the odds of a 25 basis-point rate cut currently stand at 70%, while the odds of a 50 basis-point rate cut are at 30%.

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