On Sept. 3, the Bitcoin (BTC) price, the S&P 500 and gold all fell at the same time. The sentiment around the market remains cautiously negative after the drop.

Two factors may have triggered Bitcoin’s sudden drop of more than 8% on the day. First, miners sold an unusually large amount of BTC in a short period of time, and second, the U.S. dollar index began to recover from years of key support areas.

BTC/USD daily chart. Source: btc/usdTradingView.com

Analysts also attribute gold’s decline to the rising dollar. The European Central Bank issued a warning about the surging euro, leading investors to be cautious about the euro. The change in investor confidence further spurred the dollar and led to gold’s slide.

The drop in the S&P 500 could be coincidental, as this drop comes on the heels of a strong sell-off in large tech companies.

What’s next for Bitcoin prices?

The sentiment surrounding Bitcoin remains mixed after the big drop. Some investors have indicated that BTC is likely to stabilize above $10,500 and see a continuation of the bull market.

Others hinted at the possibility of a medium-term top, given the strength of the pullback in key areas. A pseudonymous trader named “DonAlt” said.

“We do have the potential to put in an intermediate term top here. Reclaiming the mid $11,500 range until the end of the week, I would call this idea invalid, but until then, I think this structure would be a wonderful looking top.”

Bitcoin’s sharp drop from $12,000 to below $10,500 suggests that $12,000 to $12,500 is a strong resistance zone and that BTC could have a head-and-shoulders pattern on a higher time frame.

Technically, Bitcoin fell from $11,462 to $10,460 in 24 hours, which increases the likelihood of a deeper pullback. This is because BTC gave back 31 days of gains with a daily candle.

The bullish market structure remains intact, eToro crypto-assets analyst Simon Peters told Cointelegraph. As such, until BTC falls below $10,000, technicals suggest a massive correction is unlikely. Peters said.

“The $11,300 level that served as support throughout August has now been broken and Bitcoin may have a long way to go. We can now expect a retest of $10,000 as a new bottom, which could also coincide with the 200-day EMA (Exponential Moving Average). From a technical point of view, this could support the price action and prevent further price declines.”

The last few months have been the longest time Bitcoin has remained above $10,000 since 2017. Another variable that could stop further downward trends is buyers from off-market entering the market in the $10,000 region.

There’s a silver lining.

The silver lining, according to Peters, is that the recent pullback may tempt buyers in the near term. There is a lot of money on the sidelines, especially in the stablecoin market.

“There are a number of potential reasons for the sell-off – not the least of which is the miners’ sell-off. If there’s a silver lining, it’s this – a fall back to $10,000 is likely to tempt some bulls who’ve been sitting on the sidelines to finally invest in Bitcoin.”

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