Was it a bear trap under $60K? 5 things to know in Bitcoin this week
Bitcoin will start the third quarter of 2024 with a pop as bulls look to regain lost ground on the way to all-time highs.
Bitcoin (BTC) price strength is temporarily returning as the $60,000 support remains on the composite weekly, monthly and quarterly charts.
Building on a 4% gain in 24 hours, Bitcoin has definitely quit to continue the bull market.
Months of consolidation have now resulted in two trips below the $60,000 mark, both of which are now increasingly being seen as bear traps. Can the Bulls really win?
From now on, traders will look not only at $60,000, but also other important bull market trends to gain more confidence in BTC's price correction.
In addition to inflationary signals from top Federal Reserve officials, more U.S. unemployment data on the cards this week will add to the overall volatility of macroeconomic data.
Attention is also on Bitcoin miners. After several weeks in the hashrate “capital,” will the current low hashrate keep the industry from falling behind?
Cointelegraph will be watching these issues closely and BTC/USD is hoping for bulls to recover from the false breakout from July.
Bitcoin faces a battle for the continuation of the bull market
A series of spikes on the last day of June helped bitcoin close above $62,500, a promising weekly, monthly and quarterly high.
Momentum continued, BTC/USD hit a local high of $63,724 on Bitstamp before consolidating lower, according to data from Cointelegraph Markets Pro and TradingView.
CoinGlass tracking figures confirm losses of 7% in June, while Bitcoin fell by a total of 12% in Q2.
Looking to the future, however, market participants remain cautious, with much room for recovery to improve sentiment.
For Keith Alan, founder of trading resources Material Indicators, “Bitcoin had a rally from the lows, but right now, bulls don't seem to have enough momentum to close above the 21-week moving average.
“Failure to move above it may indicate another test of the lows before BTC returns to the ATH territory,” he wrote in part of the latest update on X.
Allen cites an important support line that has recently been lost as support. The 21-week moving average currently sits around $64,000.
“TLDR: save some dry powder,” he concluded.
Prominent trader Dan CryptoTrades, meanwhile, described a large “gap” in CME Group's Bitcoin futures, thanks to a reversal over the weekend.
Starting at $60,400, this now represents “the biggest we've had in a long time,” he warned.
“1. Yes, the gap below can be closed, but as we speak, the price is too far, so don't overvalue it. He wrote part of the analysis on X.
“2. If the market wants to flee, these weekend moves/gaps are the perfect time to do so. Very sideways leaves. We've seen such gaps form before that haven't been closed months/years.
Meanwhile, the order book liquidity price shows that it has set up several liquidity hunts through July, with $64,100 now a key area of interest.
Unemployment data meets Fed's Powell.
Several U.S. unemployment data are a key component of the week's macro volatility stimulus.
Despite the 4th of July holiday, there is no shortage of events that could spark some amazing crypto market activity in the coming week.
In addition to unemployment — a sensitive topic for Bitcoin and altcoins in 2024 — Fed Chairman Jerome Powell will speak from the Monetary Policy Forum in Sintra, Portugal on July 2.
A day later, the minutes of the Fed's previous inflation policy meeting will be released.
“We have a short but very busy week ahead,” marketing resource Kobeisi's letter summarized about the upcoming diary dates.
Looking ahead, trading desk QCP Capital is bullish on the broader risk-asset climate in July.
“Looking at seasonality, BTC has an average return of 9.6% in July and is especially pulling back after a negative June (-9.85%),” he wrote in part in a recent announcement to Telegram channel subscribers.
“Our options desk observed a flow position last Friday towards the end of the month, possibly anticipating the launch of the ETH Spot ETF. A lot of signs are sad that it's July.
The key BTC price trend is highlighted
So far, Bitcoin has no motivation to overcome the resistance near the key $64,000 level.
The importance of the zone where BTC/USD has declined so far after the monthly open is based on multiple trends converging at one point.
According to Cointelegraph, in addition to the 21-week moving average, $64,000 is the price base for Bitcoin's short-term holding (STH). Also known as realized value, it reflects the total purchase price of coins acquired through speculation.
The cost base has served as support in the current bull market, with the only exception being August 2023.
“If the price does not quickly move above the value of sth, it may turn into a resistance level for the price going forward,” SignalQuant, promoter of Onchain Analytics Platform CryptoQuant, warned in its Quicktake blog posts last week.
At current prices, STH entities corresponding to those holding a certain amount of BTC for 155 days or less are on average somewhat underwater.
The market value to fair value (MVRV) measure, which compares STH's holdings to their purchase price, is therefore below the 1st break point. With the exception of early May, this is the first trip to bankruptcy protection since October 2023. , the Onchain Analytics firm confirms Glassnode's data.
Light at the end of the tunnel for miners?
Despite a moderate BTC price recovery, the fundamentals of the network remain in what some describe as “capital.”
The problem is still predicted to decrease by 5% this week, estimates from monitoring resource BTC.com, and Bitcoin miners continue to adapt to the new economic reality post-half.
As Cointelegraph reports, less efficient miners may shut down due to costs, leading to a drop in hashrate — a common occurrence after a halving event.
The hash ribbon metric, which compares the 30-day and 60-day hashrate, shows the level of “capital” among mines still in place.
This comes after withdrawals from mining-related wallets, mining coins sent to exchanges and OTC transactions have all fallen sharply over the past month, creating renewed optimism about profitability conditions.
CryptoQuant contributor Crypto Dan said in a recent Quicktake post on the subject: “Miners' sales pressure has dropped significantly and their sales volumes are being crushed quickly.”
Sufficient conditions are in place to resume the upward rally in the third quarter of 2024.
Crypto market sentiment sees a significant recovery
The close of the quarter is already making itself felt when it comes to the overall sentiment of the crypto market.
Related: 3 Things That Could Ruin July for Bitcoin
The latest readings from the Crypto Fear and Greed Index have already shown improvements to “Greed” over the weekend.
The fear and greed index rose six points on July 1, and as a lagging indicator, the full impact of recent gains in the mixed crypto market cap may yet be seen.
In comparison, on June 29, the index measured only 30/100 – a value that not only corresponds to “fear”, but also knocks on the door of “high fear” as an average sentiment score.
At the lower lows, research firm Sentiment noted “oversold” readings on Bitcoin's Relative Strength Index (RSI), an early sign of a possible recovery.
Bitcoin's mild recovery after the last two weeks has been short-lived for now. But note the continued negativity from the crowd, which shows their patience is wearing thin,” he told X followers.
“This, along with a low RSI of 36, are indications that a breakout is imminent.”
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
