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What’s Next For Bitcoin

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Bitcoin tumbled for a fifth-straight day, putting the largest cryptocurrency on track for its worst month in more than three years and leading a full-flown retreat from digital-asset markets.

At press time, Bitcoin (BTC) was changing hands at around $37,000, after dropping to $30,000 on Wednesday. The price was down 13.76 percent in 24 hours.

Bitcoin price has dropped almost 50 percent from its ATH of $64,863

The latest crash shook out bullish leverage from cryptocurrency derivatives markets, leading to more than $8 billion in position liquidations due to margin calls.

While bitcoin has shed over 30% in the last 7 days, other top 10 coins such as ether (ETH, -34.85%), internet computer token (ICP -55.28%), Binance token (BNB 41.63%), Cardano (ADA -3.84%), XRP (-14.64%), Dogecoin (Doge -14.98%) have suffered even bigger losses, according to data source Coinmarketcap.

It was reported that the correction could soon run out of steam as technical indicators show oversold conditions. Further, the order book is flashing signs of capitulation, the point at which traders trying to enter long positions begin throwing in the towel.

“We are nearing capitulation to the downside,” crypto research firm Jarvis Labs noted in a post on Medium early Wednesday, while drawing attention to the relatively low concentration of leveraged longs at deeper price levels on Binance, the world’s largest crypto exchange by trading volume.

Capitulation is widely considered the final stage of the price sell-off.

Analysts, however, stand divided on whether the market has bottomed out. Patrick Heusser, head of trading at Swiss-based Crypto Finance AG, told CoinDesk that the market needed a correction, and prices could consolidate at lows before moving higher.

“Our desk is buying the dip,” Heusser told CoinDesk.

Stack Funds Chief Operating Officer and co-founder Matthew Dibb said the pullback to the 200-day SMA is nothing out of the ordinary and noted that a further decline to $30,000 is possible.

Bitcoin has taken a beating over the past week, falling sharply from over $50,000 to 3.5-month lows under $40,000.

“The BTC enthusiasm has been sucked out last week by the confluence of “Elon’s corporate ESG (environmental, social and governance) stamp of disapproval, the SEC’s (U..S. Securities and Exchange Commission) public un-enthusiasm for any ETF (exchange-traded fund) & the CME backwardation,” QCP Capital noted in its Telegram channel. Backwardation is when the current price of an asset is higher than its futures price.

Musk attempted to calm market nerves late Sunday with a Twitter announcement stating that the company hasn’t sold its bitcoin holdings. So far, however, that has failed to put a floor under the cryptocurrency.

According to Simon Peters, a crypto-asset analyst at multi-asset investment platform eToro, he said, “from a technical point of view, the price is finding some support from the 200-day exponential moving average, plus other momentum indicators such as the RSI, which shows that the price is somewhat oversold.” 

“This means there is a possibility of buyers now stepping in to push prices up and, as we have seen before, investors waiting on the sidelines are already using the sell-off we have seen to invest in crypto assets, taking advantage of the volatility,” Peters added.

Bitcoin

Bitcoin Eyes Gains with Seasonal July Boost After Slump

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Bitcoin - Investors King

After several months of declines and rangebound trading, Bitcoin (BTC) bulls have reason to cheer as the largest cryptocurrency is poised for a potential seasonal upswing this July.

Historical data and recent market movements suggest a positive outlook for Bitcoin, following a period marked by billions in sales, upcoming selling pressure, and outflows from exchange-traded funds (ETFs).

Since April, Bitcoin has been trading within a narrow band of $59,000 to $74,000, weighed down by market dynamics and peak negative sentiment among retail traders.

However, July has historically been a bullish month for Bitcoin, and early indicators show a possible reversal of recent trends.

On the first day of July, U.S.-listed ETFs recorded nearly $130 million in inflows, their highest since early June.

This influx comes after a significant $900 million outflow in the previous month, signaling renewed investor confidence in the cryptocurrency.

“Bitcoin has a median return of 9.6% in July and tends to bounce back strongly, especially after a negative June,” said Singapore-based QCP Capital in a recent Telegram broadcast.

“Our options desk saw flows positioning for an upside move last Friday into the month-end, possibly in anticipation of the ETH spot ETF launch. Many signs point to a bullish July.”

Historical data supports this optimistic outlook. Over the past decade, Bitcoin has gained an average of more than 11% in July, with positive returns in seven out of the ten months.

A 2023 report by crypto fund Matrixport highlighted significant July returns in recent years, with gains of around 27% in 2019, 20% in 2020, and 24% in 2021.

Seasonality, the tendency of assets to experience regular and predictable changes that recur annually, appears to be a driving factor.

These seasonal cycles can be influenced by various factors, such as profit-taking around tax season in April and May, leading to drawdowns, and the generally bullish “Santa Claus” rally in December, which reflects increased demand.

As the cryptocurrency market enters July, Bitcoin traders and investors are optimistic about a potential rally. While the market remains cautious of underlying pressures, the historical trends and recent inflows suggest a favorable environment for Bitcoin’s resurgence.

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Bitcoin

Bitcoin Slumps 13% in Q2, Prompting Investor Concerns

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As the second quarter of 2024 concludes, cryptocurrency investors are left contemplating the future of Bitcoin after the leading digital currency retreated significantly from its all-time highs.

Bitcoin, which had previously soared to a record $73,798 in mid-March, has seen a sharp decline, closing the quarter at approximately $61,000.

This represents a 13% drop since March, a stark contrast to the substantial gains of 67% and 57% in the previous two quarters, respectively.

The downturn has spurred concerns among investors about the broader implications for risk appetite in financial markets, particularly as the prospect of higher-for-longer interest rates looms.

This sentiment was echoed by Austin Reid, Global Head of Revenue and Business at FalconX, who noted, “A lot of people in the market have questions that are mostly anchored on concerns from a macro perspective. I think there’s just some short-term uncertainty being reflected within the crypto market, as we’re seeing in some other asset classes too.”

One of the clearest indicators of waning interest in Bitcoin is the significant slowdown in demand for U.S. exchange-traded funds (ETFs) that hold the cryptocurrency. These funds, approved by the Securities and Exchange Commission in January, saw a flood of interest initially.

However, the second quarter saw inflows of just $2.6 billion into Bitcoin funds, a sharp decline from the $13 billion recorded in the first quarter, according to data from CoinShares.

“There was a lot of euphoria around the release of the ETFs, and then there was a natural price correction after the rally,” said Matthew O’Neill, Co-Director of Research at Financial Technology Partners.

He explained that the ETFs initially attracted professional investors who wanted Bitcoin exposure but preferred to do so through institutional means.

The reduced inflows into Bitcoin ETFs may reflect a broader hesitation among investors to re-enter the market amid current uncertainties. For those who haven’t yet bought into the ETFs, O’Neill suggests they might be waiting for the next upward price move before committing.

Despite the current downturn, the longer-term outlook for Bitcoin remains a topic of debate. While some analysts see the recent price correction as a temporary setback in an overall bullish trend, others warn that the cryptocurrency market could face more significant challenges ahead, particularly if macroeconomic conditions remain unstable.

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Bitcoin Slumps to One-Month Low as Crypto Market Loses Steam

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bitcoin to Nigerian Naira - Investors King

The cryptocurrency market is facing a turbulent period, marked by significant declines and waning investor confidence.

Bitcoin, the leading digital asset, has dropped to a one-month low, trading at approximately $62,275 as of Monday morning in London.

This decline is part of a broader downturn in the crypto market, which has seen its second-worst weekly performance of 2024.

The overall gauge of the largest 100 digital assets fell by about 5% over the past week, according to data compiled by Bloomberg.

This represents the worst decline since April and highlights the growing concerns among investors regarding the future of digital currencies.

A key factor contributing to this downturn is the cooling demand for Bitcoin exchange-traded funds (ETFs).

Over the past six days, U.S. Bitcoin ETFs have experienced a consistent outflow of funds, undermining the confidence of investors who were hoping for a steady influx of capital into these investment vehicles.

This has compounded the already existing uncertainties surrounding the cryptocurrency market.

Adding to the market’s woes is the prevailing uncertainty over the Federal Reserve’s monetary policy.

Speculation about the Fed’s ability to cut interest rates from their current two-decade high has created a cloud of doubt over the entire financial market, including cryptocurrencies.

Analysts suggest that this uncertainty is dampening broader risk appetite, with investors becoming increasingly cautious about their investments in volatile assets like Bitcoin.

David Lawant, the head of research at FalconX, noted that the current crypto market dynamic is “characterized by low volatility, soft volumes, and order books getting unbalanced when prices start to move to the edges of their range.”

This imbalance has made the market more susceptible to sharp declines, as seen in the recent slump.

The declines in other major cryptocurrencies are also noteworthy. Ether and Solana have experienced their longest streaks of weekly declines since last year and 2022, respectively.

This comes despite preparations by fund companies to launch the first U.S. ETFs that invest directly in Ether, the second-ranked crypto asset. Solana, once a favorite among digital-asset hedge funds, has also seen significant drops.

Bitcoin, which hit a record high of $73,798 in March, is now trailing behind traditional assets such as stocks, bonds, and gold this quarter.

Analysts are now focusing on the 200-day moving average, currently at around $57,500, as a potential zone of support for Bitcoin’s price.

Tony Sycamore, a market analyst at IG Australia Pty, suggests that this level could provide some stability in the coming weeks.

As the cryptocurrency market navigates through these challenges, investors and analysts alike are keeping a close watch on any developments that could influence the market’s direction.

For now, the sentiment remains cautious, with many waiting to see if the recent declines will continue or if a recovery is on the horizon.

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