Bitrabo Editorial
Bitcoin’s spot rates have weakened, falling below $66,000 from the highs of July 2024. Despite bearish pressure targeting $60,000, there is hope among bulls for a forthcoming rebound.
For an uptrend to establish, buyers must decisively breach the critical zone between $66,000 and $70,000. Ideally, surpassing $72,000, the last resistance before the all-time high near $74,000, would be favorable.
Bitcoin Struggling: Potential Impact of Rising Inflows to Exchanges
Analysts anticipate Bitcoin may continue to record lower lows, signaling losses in the current period. Examination of CryptoQuant data shows a development in age bands over recent years and months, which can shed light on selling pressure trends.
The transfer of large volumes of BTC by long-term holders to prominent exchanges like Coinbase and Binance often signifies an intention to sell, hinting at a bearish market outlook.
A notable observation is the correlation between increased coin transfers to exchanges by long-term holders and price declines, particularly evident since late July 2024. The analyst cautions that this influx of new coins could potentially prolong the recovery process.
Potential Recovery and Role of Spot ETF Inflows for Bitcoin
There is uncertainty regarding whether bulls will intervene to counter the selling pressure witnessed recently. Immediate support lies within the $60,000 to $63,000 range, with a potential recovery above this level signaling a resurgence for Bitcoin.
The recovery pace or downturn severity traditionally hinges on inflows, typically driven by new market participants. However, the emergence of spot Bitcoin ETFs in the US has disrupted this pattern.
Analyst evaluation suggests that the recent surge pushing Bitcoin over $72,000 wasn’t fueled by increased inflows from novices but rather by institutional participation through spot ETFs.
Sentiment shifts amid price drops could prompt outflows, intensifying the Bitcoin sell-off if capital is withdrawn from spot ETFs. On August 1, all ten spot Bitcoin ETFs in the US experienced outflows totaling 1,500 BTC, exceeding $94 million, as per Lookonchain data.